Housing

HC Deb 27 November 1991 vol 199 cc932-73

Mr. Speaker

I have selected the amendment in the name of the Prime Minister. In view of the late start of this debate, may I ask hon. Members who are called, in the interests of their colleagues, to make brief contributions. That also applies, please, to the Front Benches.

4.37 pm

Mr. Clive Soley (Hammersmith)

I beg to move, That this House is appalled by the complacent attitude of the Government towards the high levels of mortgage debt and repossession which are due to the Government's high interest rate policy, unemployment, the slump in the property market and the general mismanagement of the economy; notes that close to one hundred thousand homes will be repossessed this year and one in twelve mortgage payers are two months or more in arrears; and calls on the Government to introduce a mortgage rescue scheme as a matter of urgency. I had already decided not to speak for more than 20 minutes, not least because the Government are so embarrassed by this case that they are providing not only statements along the same lines as the private notice question but points of order which are designed to waste time.

The motion refers, among other things, to the growing mortgage crisis and to the need for a mortgage rescue scheme. I note that in their amendment the Government cannot even bring themselves to mention the problem of mortgage repossession or mortgage debt. They try merely to avoid it, which is what they have done since the problem emerged so drastically.

It is instructive to consider the Conservative party's promises to mortgage payers. I could take the House a long way back on that issue but I shall stick merely to the commitment that the party made in 1979 so that we can examine the record and see what it has achieved. On 23 February 1979 the Conservative central office said: The next Conservative Government will manage the economy to keep interest rates down and so reduce the cost of a mortgage. The Conservatives were foolish and unwise enough to repeat the promise in the election manifesto of 1979. What happened? When the Conservatives won the election in May 1979, the mortgage rate rose sharply from 11.75 per cent. to 15 per cent. Mortgage rates have been below 10 per cent. for just two short periods since 1979. That is the extent of the failure of the Conservatives to deliver a clear promise in 1979 to keep mortgage rates and interest rates down. The ex-Prime Minister and other Conservatives had the audacity to say that interest rates were high in the early stages of the Conservative Government only because people were borrowing too much. It may be interesting to ask why interest rates are still high given all the Conservative promises about keeping them down.

Mr. D. N. Campbell-Savours (Workington)

In examining interest rate movements, has my hon. Friend noted that interest rates were at the bottom of the trough in 1983, around the time of the general election, and in 1987, around the time of the general election, and that they are now moving to the bottom of the trough in time for an election in 1992? Is not it clear that the Government are manipulating interest rates to ensure that at times of general elections they are at the lowest possible level?

Mr. Soley

My hon. Friend anticipates me. I will deal with that point in sequence.

While the Prime Minister was Chancellor of the Exchequer, the mortgage rate was 15.05 per cent. for new mortgages, which was 2.37 per cent. higher than the average achieved under this Government and no less than 4.3 per cent. higher than the average under the Labour Government for the whole period from 1974 to 1979. In that respect, we draw attention not only to the high interest rate policy of the Government, but to their general failure to manage the economy. That rate was also the highest mortgage rate for any Chancellor of the Exchequer since, probably, the 1920s. It is difficult to check back with comparable prices beyond that. As Chancellor of the Exchequer, the Prime Minister presided over the highest rate of any Chancellor of the Exchequer. That is the measure of his failure.

In their amendment, the Government claim that they are reducing interest rates, and this is where I come to the point made by my hon. Friend the Member for Workington (Mr. Campbell-Savours). The Government reduced interest rates before the general election in 1983. Immediately after winning that general election, they increased interest rates. They reduced interest rates immediately before the 1987 election. Immediately after they won that election, they increased interest rates. They did precisely the same when they won the election in 1979. We do not need to look into a crystal ball; we have the record, which all can see.

Mr. Malcolm Moss (Cambridgeshire, North-East)

Will the hon. Gentleman confirm that interest rates in 1988 were lower than they were in 1987, at the time of the general election?

Mr. Soley

Interest rates then were only just going down. As the hon. Gentleman knows, the Conservative party—anyone can look up the figures—lowered interest rates before elections and put them up immediately afterwards. That will happen next time if—and this is an unlikely eventuality—a Conservative Government are re-elected.

The hon. Member for Cambridgeshire, North-East (Mr. Moss) may like to take another point on board. The average mortgage rate under Labour was 10.75 per cent. The figures refer to the whole period of office for each party. Under the Tories, the figure is 12.68 per cent. I refer to those figures in the context of a Government who enjoyed all the advantages of North sea oil wealth, of relatively low commodity prices around the world, and of privatisation assets, and who had none of the disadvantages of oil price rises, such as were experienced in the 1970s. Despite all that, the Government not only delivered two massive slumps, which had an effect on home ownership, but managed to deliver interest rates that were constantly 2 per cent. higher than they were on mortgages under Labour. That is a pretty damning indictment.

Mr. Tim Devlin (Stockton, South)

Is not the situation now rather different from that of previous elections? We are now in the exchange rate mechanism of the European monetary system. That is the way in which the interest rate cuts have been delivered in past months. The exchange rate mechanism will remain, I hope, as a permanent fixture for the future.

Mr. Soley

I noticed that the hon. Gentleman used the words "I hope". When I looked at the Government amendment, I was fascinated to see that it says that the House welcomes the fact that interest rates have been set at a level within the European Exchange Rate Mechanism which has succeeded in substantially reducing inflation". Everyone who reads the current financial pages knows that the danger for the pound is that it is bouncing along the bottom of that rate. If the Government are not careful, or if they are simply unlucky in terms of decisions made by the German Chancellor about raising interest rates, they will be outside the rate in no time. We shall then be in a massive financial crisis as well as in an industrial crisis—and the Government have produced such a crisis on two occasions. The House should remember that the Government for the first time ever have created for Britain a balance of payments problem for manufacturing industry because they wiped out manufacturing industry in the first slump in the early 1980s and they are in danger of wiping out our other advantages in the second slump.

Mr. Devlin

rose——

Mr. Soley

I should like to give way, but I remember Mr. Speaker's advice and I should stick to 20 minutes.

Mr. Devlin

rose——

Mr. Soley

I will give way happily, although the hon. Gentleman should remember that it will be at the expense of other Conservative Members.

Mr. Devlin

I used the words "I hope" because the Labour party has changed its attitude on Europe by 180 degrees no fewer than five times. There is no telling whether after the next election, if the Labour party were elected to government, its present new-found commitment to the European Community will be turned on its head once again.

Mr. Soley

You would rule me out of order, Madam Deputy Speaker, if I went too far down that road. Suffice it to say that the Government have taken away any real choice from the British people of going into a common European currency. When the previous Prime Minister signed the Single European Act, she more than anyone else put us on that course, as Conservative Members know.

The Government's high interest rate policy, which they have pursued consistently since 1979, is the root cause of the housing crisis in owner occupation. Almost 100,000 homes will be repossessed by the end of the year. When I first gave that figure, people said that it would probably not be so high. Now I note that various people are saying that the total is likely to be 115,000. I will stick to my estimate of close to 100,000. About one in 12 people with mortgages are in mortgage arrears. The 100,000 repossessions this year compares with 2,500 in 1979. The figure of 100,000 is equal to the population of towns such as Oxford, Exeter, Norwich or Basildon. Many of those whose homes are repossessed will go into bed-and-breakfast or emergency accommodation. One in 12 mortgage payers are in arrears of two months or more. That means that roughly 1 million mortgage payers are in serious trouble. When I give the figures, I am not talking about people who hand in the keys. They are excluded. I am not talking about people who pay most but not all of their mortgage each month. We are talking about a minimum figure of 1 million.

What is the other factor, along with interest rates, that is affecting us so drastically? It is unemployment. As we all know and as the Government concede, unemployment will continue to rise. All that the Government can say is that the rate of increase is less, "seasonally adjusted"—the funny phrase that they use. The Government have already clobbered manufacturing industry in the north and they are now busy clobbering industry in the south. The net result is that unemployment in the south will, this time, rise far more drastically—and the rate of interest confirms that—than in other parts of Britain. That is why so many Conservative Members are quoted in Roof magazine as being worried about the issue. They are worried because most people in mortgage arrears or whose homes are being repossessed are in the south or the midlands—the areas having most problems with unemployment.

The recession and the collapse of house prices that goes with it aggravate the problems in the south—and elsewhere in Britain. They mean that people cannot easily trade down. People who bought in 1988 when the market was high suddenly found in 1989, 1990 and 1991 that they were selling at a loss. So they could not even get out of their debt, let alone pay the mortgage. One would have thought that, faced with those figures, Ministers would express concern.

I have drawn attention to the fact that in their amendment to our motion the Government cannot even bring themselves to mention the mortgage problem. What do Ministers say? One interesting idea comes both from the Minister for Housing and Planning and from his deputy, the Under-Secretary of State, the hon. Member for Suffolk, South (Mr. Yeo). On a "World in Action" programme the Minister for Housing and Planning said that the best mortgage rescue service was a drop in interest rates. His deputy used that phrase too, on "The Time … The Place"—a programme on which I joined him. He told an audience of 50 or 60 people, all of whom had had their homes repossessed, that help was on the way because mortgage rates were coming down. I have to tell him that to someone whose home has been repossessed it makes no odds whether the interest rates are going up, down or sideways. It is too late for them. It is too late for many people, because even if interest rates came down by another 1 per cent. tomorrow—they will not—the repossession figures would continue to rise. Sadly, the prediction for the number of repossessions in a year's time is still about 100,000.

On 2 July the Minister for Housing and Planning said: I do not accept the gloomy forecasts that are made of future repossessions. Those who coped during the period of rising interest rates should be able to cope as they fall. I would therefore hope to see fewer repossessions. The hon. Gentleman said that only four months ago, yet it does not look too convincing now, does it?

What else do Ministers say? Another response, which has not been used so much recently, was by the previous Minister responsible for housing, who is now the Secretary of State for Employment. Under a nice headline in the papers saying: Lodgers can ease mortgage bills, says Minister", the right hon. and learned Gentleman was reported as stating: Lodgers now had no security of tenure —that was a result of the Housing Act 1988— making it easier for householders to repossess the property…'With a minimum of effort people can raise extra income to offset the increased cost of their mortgages. That has to be good news for lenders.' What has happened since then? One problem, which we tackle in the mortgage rescue scheme, is that when people who have taken out a mortgage have a lodger, when the house is repossessed the lodger, too, will be made homeless. What is more important, in a significant minority of cases, the lodger does not even know that the mortgage is in arrears. There is a recent case in Camden, and I could name many others. The first that the lodgers know of the threat of eviction is when it takes effect and the bailiffs appear at the door. That kind of thing was encouraged by the Minister who was responsible for housing at the time. The Government have still not dealt with it. They hoped that the building societies would change the rules. The story from which I have just quoted was based on a call to the building societies and banks to change the rules, but they did not do so.

The Government amendment says that they have achieved "diversification of tenure" among other things. Does that mean that more people are sleeping rough in the streets and more are in bed-and-breakfast and emergency accommodation?

Let us remember the Rowntree report—the Duke of Edinburgh's report—the second edition of which was published in July or August this year. It said that almost 2 million—1.9 million—homes had disappeared from the rented sector since 1979, half from the council sector and the other half from the Government's much-loved private rented sector. When the Labour party left office, private rented accommodation accounted for 14 per cent. of the rented market. Now it is only 7 per cent. There has been a marginal increase in middle and upper rent areas, but almost certainly that rise is due to the depression in house prices. When prices start to rise again a lot of the people in such accommodation will be evicted, because they have assured shorthold tenancies and it only takes six months to get them out. Then homelessness will increase again. That is what the Government are boasting about.

We cannot get rid of 2 million homes from the rented sector in 12 years, and neglect to put anything in their place, without expecting a dramatic and growing housing crisis. The collapse in the construction industry—another aspect of our concern about the state of the economy—confirms that crisis. I could use more than all the time allowed me simply in quoting the views of the construction industry, many of whose companies bankroll the Tory party. It is interesting that the number and amount of such contributions have been dropping rapidly. That is not entirely surprising when we read what Sir Clifford Chetwood, the chairman of Wimpey, backed by the building material producers, is reported as having said about the construction industry: This is an industry in crisis…In terms of workload and order books things are getting worse. There are harsh times ahead … Britain was on the brink of a housing crisis that would leave a shortfall of more than 1 milion homes between those being built and those needed. Lest hon. Members should think that I am quoting an out-of-date report, I must tell them that what I have said is taken from yesterday's report in The Guardian of Sir Clifford's speech and the survey undertaken by the National Council of Building Materials Producers.

Many other examples show that the construction industry is in desperate trouble. Increasingly, it supports the call from ourselves and from Conservative-controlled local authorities that authorities should be allowed to spend their capital receipts on housing investment, to boost the industry.

Mr. Jonathan Sayeed (Bristol, East)

Can the hon. Gentleman tell me of any year during the past 30 years when the construction industry said that it did not want local and national government to spend more money?

Mr. Soley

Yes, that was so for about two years in the mid-1980s. In the first part of the 1980s the industry was desperate because of the slump; in the mid-1980s it enjoyed the boom; now, in the late 1980s and early 1990s, it is experiencing the bitter wind of another Tory slump. I am grateful for the hon. Gentleman's intervention, because it proves my point and illustrates what we mean by the Government's inability to manage the economy. They talk well, they talk the economy up and talk about management, but their record on interest rates, on the productive base of the economy and on great industries such as the construction industry tells a story of failure, of how weak we have become.

Even if we were to launch a major housing investment programme now, the construction industry could not deliver quickly without sucking in imports. It has not invested here because the Government have not given it the confidence to do so. There is also a lack of skilled labour. Soon 250,000 construction workers will have been lost to the industry as a result of the recession. Sadly, contrary to popular opinion, the skilled labourers lost in that way do not automatically come back into the industry when it re-expands. We have had to take that problem on board in devising the policy that we shall put into effect in government. The danger is that, even if one wanted a rapid building programme and had masses of money to carry it out, one would still be restrained by those bottlenecks. There would be a danger that untried, untested techniques for building high-rise or prefabricated dwellings would be adopted. We have set our face against that, but I can see the present Government trying to get away with it; they have cut corners with that sort of housing before.

The Government are trying to introduce schemes that they hope will buy off the voter and somehow divert attention from the mortgage crisis. The Minister recently introduced a half-baked scheme, with the support of the Council of Mortgage Lenders—or rather, of one individual who works for that council, who believes that it is a good idea. Many of the building societies are not so convinced.

Basically, the idea is this: when a property is repossessed, the building society or bank informs the housing associations, which then decide whether they can take the property over on a temporary basis and rent it to someone in emergency accommodation. I call the scheme half-baked, Madam Deputy Speaker, because, if you were in the unfortunate position—which I hope you are not—of having been put into bed-and-breakfast accommodation having had your house repossessed, a housing association might come along and say, "We have a property in which to rehouse you, and you could find yourself back in your own property. Theoretically, that could happen, although statistically you would be more likely to end up in someone else's property". Surely the Government have the wit to understand that that is a chronically inefficient way of dealing with the problem.

I do not think that I am making an accusation that the Government would challenge when I say that the main aim of the scheme is to boost house prices by holding back from the market repossessed properties, which now account for about one in five of the properties being sold and which are depressing the property market.

We propose something rather better than that half-baked scheme. For a year now, we have been saying that the Government should urgently call in representatives of the housing associations, the main lenders—the building societies and banks—and the local authorities to set up a proper mortgage rescue scheme. Let me describe how that would work. The first aim must be to allow people to buy time—and buy it for no money—in a way that is advantageous even to the building societies and banks. If the Government were serious, they would take on board our suggestion and say to lenders, "You can repossess but you cannot evict straight away."

Let me explain the advantage of that. It normally takes building societies and banks a minimum of six months to sell a repossessed property, and it often takes much longer. Moreover, when they sell, they do so at below the normal price. We say that they should let the person stay in the property as an assured shorthold tenant for, say, six months or a year. That will give the lending institution a definite date at which it knows that it can sell with vacant possession; but, above all, it will give the individual or family concerned time to work out their options. It will also give time to consider the second part of our package—the mortgage rescue itself—which will clearly be of value to everyone.

Another advantage of that arrangement is that it will give the bank or building society an income, in the form of the rent, instead of perhaps facing a loss in the form of a management fee payable to a housing association or local authority. A property that would otherwise stand empty could be pulling in a rental income as well as providing a roof over people's heads. Finally, we, the poll tax payers, would not have to pay for families to go into bed-and-breakfast accommodation—the worst type of subsidy to give for mortgage rescue purposes—as we do at the moment. It is a crazy system. What are we doing turning the dream of home ownership into the nightmare of bed-and-breakfast accommodation, paid for by the poll tax payer? That must be gross incompetence as well as lack of concern.

The second part of our mortgage rescue package is the option of shared ownership. Many people are in trouble with their payments and are headed for repossession and, at present, there is no alternative to that, even though, in many cases, their incomes may not have dropped so catastrophically that they cannot pay part of the money that they owe. I am talking, for example, about people who lose overtime earnings and so on. In such circumstances, it would be sensible to allow a local authority or housing association to buy the property and immediately sell part of the equity to the occupier, who would then pay part rent and part mortgage and who could step back to full ownership when his financial situation improved. That would help a lot of people.

Another critical part of our package concerns help for those in dire trouble because of a family breakdown—the classic example—or because the wage earner in the family has lost his job and has no possibility of finding another in the reasonably near future. Families who lose their income completely often end up in bed-and-breakfast accommodation. It is not only more humane but infinitely better financially, both for the country and for the families, to allow a housing association or council to buy the property and to transfer the people living in it to the tenanted sector.

The Council of Mortgage Lenders estimates that the cost of those two schemes would be a sinking fund of £100 million. The House should bear in mind the fact that, for mortgage repossession cases only, in London alone, the cost of bed-and-breakfast accommodation is more than £50 million, and that is without taking into account many of the other associated costs.

Mr. Simon Burns (Chelmsford)

I have been following the hon. Gentleman's argument closely. If I heard him right, he said that the cost of his shared ownership scheme would be about £100 million. Where would that money come from? Logically, one could argue that, in the case of certain local authorities, it could come out of money saved from bed-and-breakfast accommodation, but we should remember that a fair number of local authorities in whose areas there are house repossessions are fortunate enough not to be on the downward spiral of bed-and-breakfast accommodation. Would the money come from the Treasury or out of the community charge payer's funds?

Mr. Soley

The Council of Mortgage Lenders thinks that it ought to come from the Government, and I have some sympathy with that view. As I said, the Government should call in the lenders, local authorities and housing associations to work out the arrangements, but, as I said, the CML thinks that it should come from the Government, through the Housing Corporation, and there is some logic in that.

Mr. Burns

Will the hon. Gentleman give way?

Mr. Soley

I want to move on because I am already exceeding the time limit that I set myself.

Why will not the Government consider such a scheme? There are a number of reasons, both hidden and real. They tend to argue that it could be too expensive—in terms of each individual house. That is easily dealt with: one simply has a cut-off point. No one is suggesting that one should buy back a £1 million house.

More important, the Government sometimes say that people would deliberately over-mortgage, knowing that they could be saved—that they would buy much bigger houses than they need. That is not real. Some months ago, I explained that a mortgage rescue scheme would not necessarily entail a person staying in his own house. Let us take the example of a family split—by no means a fiddle. Let us say that there are four children, two of whom go with the partner who leaves and the other two of whom stay at home with the wife, who has no income, in a five-or six-bedroom house. In those circumstances, one could buy the property but move them elsewhere in the rented stock, releasing the larger property for a bigger family. Indeed, one could resell when the time was right.

The mortgage lenders themselves know that a mortgage rescue scheme will have to happen sooner or later. They know that they are in trouble and, to their credit, they also recognise that they must pay some of the costs because they have made bad debts, and because such a scheme would allow them to avoid court costs. That is why they are prepared to consider the possibility of receiving less than the normal price for the house.

We are witnessing some horrific scenes. The Minister will be aware of the case of a woman who appeared on the same television programme as me, who has a six-month-old child and a two-year-old child and whose repossession date is 25 December. If someone had told me that such things happened in the 19th century, I should have said, "They cannot have happened very often." But they are happening now, this Christmas. What are we doing?

In Kent, I found a family who had been placed in bed-and-breakfast accommodation by the Conservative council. The home of two couples was repossessed. They had been renting the house from a man who was not living there and who had not paid the mortgage. Each couple was paying £80 a week in rent, making a total of £160 per week. To my mind, that amount would more than have paid the mortgage in that area. Nevertheless, the house was repossessed. One couple went into bed-and-breakfast accommodation because they had a young child and the poll tax payer had to pick up the bill.

Let us consider the case of the business man in north London who told the building society that it had overvalued his property by £20,000. The building society was a large and reputable company and denied the overvaluation. The man argued for a bit, but accepted its valuation in the end. He said, "I am doing all the things that the Government want. I am a small business man and was buying my own house. My business has now gone bust, my house has been repossessed and the building society is not only claiming the house, but the £20,000 by which it was overvalued."

I have heard horror story after horror story like that. I understand that, following the "World in Action" programme the other day, its switchboard was jammed with callers describing similar cases. What we are doing is ludicrous——

Mr. Sayeed

rose——

Mr. Soley

If the hon. Gentleman will forgive me, I shall not give way because I have been pursuing——

Mr. Sayeed

I shall be brief.

Mr. Soley

Well, the hon. Gentleman had better be so brief as not to be true.

Mr. Sayeed

I am truly grateful to the hon. Gentleman for giving way. He has suggested that there are 100,000 repossessions per year and that the cost of his mortgage rescue package would be £100 million. Although that works out at £1,000 per home, clearly many of the 100,000 cases would not be entitled to help. Therefore, will the hon. Gentleman tell the House who would be entitled to such help?

Mr. Soley

As has been said several times, it is obvious that priority would be given to people who would be eligible under the Housing (Homeless Persons) Act 1977, but the first part of the scheme that I have described—where there is repossession, but not evic-tion—could apply more widely. My own view is that. given the right thinking, we might be able to go further in the talks that we would initiate in Government straightaway and deal with cases that go wider than the provisions of the homeless persons legislation. In that way, we might be able to get across the barrier between owning and renting by establishing some form of shared ownership. That is what we would do.

There are already a number of mortgage rescue schemes. I suggest that the Government should seek to extend the London Quadrant Housing Association scheme to the whole of London. Why not? It would save money. We could also learn from the Clackmannan scheme, which is well known and well run. The scheme in Rochdale fell through because of the lack of Government subsidy and we are, therefore, still paying for bed-and-breakfast charges. Is that sensible? Of course not.

The constituency of the Minister for Housing and Planning, the hon. Member for Ealing, Acton (Sir G. Young), has the seventh highest number of repossession court cases in the country. I advise him and the Government that they are risking the wrath of the electorate on this issue. There is no reason why home owners should be clobbered in that way. The Government should not have encouraged home ownership on such a scale, or got rid of the rented sector as they did, or followed that by putting up interest rates to make home ownership unaffordable for many people. Having pushed people towards home ownership by getting rid of the rented sector and driving rents up to market levels, the Government then put up interest rates, and yet they wonder why there are now queues of homeless people having to be paid for by the poll tax payers.

The mortgage rescue scheme is an idea whose time has come. The only people who are opposed to it are a Government whose time has run out.

5.12 pm

The Minister for Housing and Planning (Sir George Young)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: welcomes the fact that interest rates have been set at a level within the European Exchange Rate Mechanism which has succeeded in substantially reducing inflation; and congratulates Her Majesty's Government on the continued success of its policies to put a decent home within reach of every family, by promoting home occupation, by the success of the Right to Buy, by securing greater private sector investment, by promoting diversification of tenure and tenant involvement, by directing public expenditure so as to secure more effective use of resources and improved performance from housing authorities and by increasing the budget of the Housing Corporation by 94 per cent. over three years.". I invite the House to reject the motion and to support the Government amendment for a number of reasons. First, the policies of the Labour party would increase rather than reduce interest rates and would therefore make the position for home owners worse rather than better.

Secondly, the speech that we have just heard from the hon. Member for Hammersmith (Mr. Soley) failed in its duty to put the current problems in their proper perspective. It also ignored the underlying improvement which I am confident is under way as earnings increase and mortgage payments fall.

Thirdly, the hon. Gentleman did not do justice to the wealth of help and support which is now available from lenders and the Government to borrowers in difficulties. He did not mention income support and, in particular, he underestimated the impact of the statement by my right hon. Friend the Minister for Social Security earlier this month on income support for unemployed borrowers, to which I shall return.

Finally, having urged the Government to introduce a mortgage rescue scheme, it became abundantly clear that the hon. Gentleman has no authority to commit the Labour party to any increase in public expenditure. When my hon. Friend the Member for Chelmsford (Mr. Burns) asked him who would pay for the mortgage rescue scheme, the hon. Gentleman quoted the Council of Mortgage Lenders, which said that it would cost £100 million and that the Government should pay. He then said, "I have some sympathy with that. There is some logic." However, the Labour party made no commitment this afternoon to funding any mortgage rescue scheme.

I turn now to interest rates. Of all the impudence of which the Labour party may be guilty, it is difficult to match that part of the Opposition's motion which berates the Government for their interest rate policy. Opposition Members have opposed many of the measures on public expenditure and privatisation which have produced the fall in interest rates. A Labour Government would mean higher borrowing, higher interest rates and more pressure on home buyers. I repeat what I and my right hon. and hon. Friends said previously. I believe that the best mortgage rescue scheme of all is the prudent management of the economy, low inflation and lower interest rates. Over recent months, the Government, pursuing policies often opposed by Opposition Members, have reduced interest rates by 4.5 per cent. That is already leading to a renewal of confidence and real prospects for stemming the rise in unemployment. More jobs will feed into greater confidence in the housing market.

The House should not underestimate the impact of those cuts in interest rates. They mean that the average borrower now pays £70 a month less than he did a year ago. With base rates falling and incomes for those in work rising, that source of pressure is clearly reducing.

Mr. Soley

The Government may have cut interest rates about seven times in a relatively short period, but they are still higher than the average under Labour. Why?

Sir George Young

If the hon. Gentleman is saying that interest rates have fallen by more than 4.5 per cent., which is the figure that I used, he will find that he is mistaken. The point that I was making is that that welcome reduction would not have been possible if we had heeded the advice of the Labour party, because it opposed many of the measures that made that reduction possible.

I have charged the hon. Gentleman with failing to put the problem of mortgage repossessions in its proper perspective, so I shall now do that. Ten million home owners have a mortgage—one that they chose to take on after working out what they could afford. Against that, fewer than 0.4 per cent. of borrowers—about one quarter of 1 per cent. of all home owners—had their homes repossessed in the first six months of this year. That includes those who have given in their keys. More than 99.6 per cent. were not repossessed. As 2.3 per cent. of borrowers are in arrears of six months or more, that means that nearly 98 per cent. are repaying their mortgage as they agreed. The vast majority are coping. I do not in any sense belittle the distress of repossession or the problems associated with it and I shall deal with that point later, but the figures tell a very different story from that of the hon. Member for Hammersmith. Home ownership remains a sensible long-term investment for those who want the independence that it brings and who are confident that the financial commitment it involves is a reasonable one.

Let me turn to the third and more substantial point—to those who do face difficulty and to the measures that are available to help them. Of course, I fully understand the trauma facing any family whose home is about to be repossessed. Many hon. Members have seen families in that position in their advice bureaux. Although the Government were not a signatory to the transaction freely entered into between borrower and lender, they should not and do not stand idly by when the borrower faces difficulties. But let me first of all make it clear that it is certainly not in every case that financial problems are the primary cause of repossessions. Marriage break-up and other relationship failures lie behind some; in others, there was initially an unrealistically large commitment. Over half the properties recently taken into possession by building societies were previously occupied by borrowers who either voluntarily relinquished or simply abandoned them, posting the keys back through the building society letter box.

I hope, therefore, that one message at least will be clearly understood after this debate. All those in difficulty with mortgage payments should contact their lender at an early stage and talk through the problem with him. Many borrowers would be surprised at the flexibility and sympathy that are shown by many lenders.

The advice of the Council of Mortgage Lenders is clear. If lenders are approached early, before arrears begin to build up, most will be only too happy to help borrowers by rescheduling payments, allowing interest to be capitalised where appropriate, or accepting less than the required monthly payment for an extended period if there is a reasonable prospect of the borrower then being able to resume full payment.

Mr. Jimmy Hood (Clydesdale)

rose——

Sir George Young

I shall give way once more, but then, out of courtesy to the House, I should like to make progress.

Mr. Hood

What can the Minister say to those individuals who bought their houses three or four years ago—they were encouraged to do so because money was thrown at them—but whose houses are to be repossessed? Those people are unable to repay their full debt which sometimes is as much as £40,000. They are made homeless and are left with a debt that they have no chance of repaying. Do the Government believe that that is the fault of the individual, or, like Pontius Pilate, do they claim that it has nothing to do with them? Who does the Minister blame?

Sir George Young

I am about to describe the solutions that are available to people who find themselves in such distressing circumstances.

The Government are reinforcing the advice available to people in such circumstances by grant-aiding the National Association of Citizens Advice Bureaux for its work on money management counselling.

Some owners can, of course, make their own arrangements to cope—often, many do. As the hon. Member for Hammersmith said, some have choosen to take in lodgers to help to meet their repayments while others have moved in with their in-laws and rented out their homes temporarily.

The hon. Member for Clydesdale (Mr. Hood) asked who is to blame for the repossessions. At the time of the great lending spree, when some lenders were offering loans of up to four times salary and property prices were soaring, a few voices urged caution. Some people will believe that building societies and banks, which thrust loans upon their customers, can hardly walk away from the problem of arrears by simply demanding repossession, particularly when there is little prospect of selling the property to recover the debt.

Surely it is better, wherever possible, to keep borrowers in their homes. I believe that the building societies are now beginning to accept that view, which will result in a reduction in the number of repossessions. They have a direct interest in reducing the number of properties repossessed—humanitarian, as well as financial.

In fact, the help given by lenders is already considerable. The wide gap between those in arrears in one quarter and the much smaller number of repossessions in the next is testimony to the help which many thousands of households now receive. That help, of course, is not entirely altruistic. Building societies have a responsibility to their members, too, and banks and mortgage insurers have a responsibility to their shareholders. But those duties are leading to a great deal of effort to find new ways in which to help individual borrowers to stay in their own homes, either as tenants or in shared ownership. In each case the insurer or building society takes an equity share. All this we encourage.

Some local authorities and housing associations are also helping borrowers to stay in their homes through shared ownership schemes. The local authority provides the capital cover for the housing association to buy the home and to sell a proportion of the equity back to the existing owner. Mole Valley, Rochdale, Clackmannanshire and Bromley all do this. Local authorities have to weigh up carefully the benefit of doing so in the light of local circumstances and the costs that might otherwise fall on the authority. It is an option only where the borrower has suffered a reduction in income but not a dramatic fall. In those circumstances, the borrower continues to pay a smaller mortgage together with a subsidised rent. Together, those payments are likely, in a typical case, to amount to about 70 per cent. of the cost of the original mortgage. That is why, for most people, talking as early as possible to their lender is the best way forward.

What action can the Government take? Direct Government help is targeted, deliberately, on the unemployed. If someone is unemployed and on income support, the cost of the interest on the mortgage will be met through enhanced income support. In 1990, more than half a billion pounds was made available in that way. This year, the figure will be higher. The hon. Member for Hammersmith totally ignored that contribution by Government and the taxpayer.

One problem is that not all this very considerable sum is used by claimants for the purpose for which it is made available. The Council of Mortgage Lenders estimates that perhaps as much as half may be lost in that way, with the result that repossessions take place unnecessarily.

The change in administrative arrangements announced by my right hon. Friend the Minister for Social Security and Disabled People on 5 November is therefore critical, because, in future, lenders will know when borrowers are applying for income support. The Department of Social Security will know if there is a history of arrears and will be able to make a direct payment to the lender, if that is desirable. No one eligible for income support need lose their home. The benefits of those changes will be felt next year.

The hon. Member for Hammersmith tried to wave a magic wand with promises of a mortgage rescue scheme. I found that part of his speech unconvincing. The hon. Gentleman berated the Government for not introducing such a rescue scheme, but he was unable to commit his party to its introduction.

The hon. Member for Clydesdale referred to repossessions and I would like to mention a separate but important initiative aimed at making use of properties which have already been repossessed and which might otherwise stay empty.

Earlier this summer, my Department set up a number of pilot schemes designed to bring back into use some of the 600,000 properties lying empty in the private rented sector. Under that scheme, housing associations act as managing agents for private owners who might not otherwise want the hassle of letting their property. That scheme will open up a valuable source of additional housing, by giving private owners the confidence to let their property and tenants the promise of a fair deal.

The building societies, which have up to 40,000 empty properties awaiting disposal, asked whether they could build upon the pilot schemes. Rather than allowing all those properties to remain empty until they were sold, the building societies agreed that it makes sense to put them to good use. Many have already stood empty for some considerable time. As a forced sale, their value is less than it would otherwise be. There is a danger that they will be vandalised, or that squatters will move in.

Under the new extension to the scheme, the empty repossessed houses on the building societies' books can be let to housing associations for periods of between one and three years, and occupied by families. Later, when the property is eventually sold, the lender should get a better price than he would from a forced sale now. The scheme also reduces the losses of the borrowers. In the meantime, the property is maintained and squatting is eliminated. The process also helps to stabilise house prices by controlling the rate at which empty property is offered in the market. Far from being half-baked, the scheme works to the benefit of all involved.

The Government's philosophy is to maximise investment in housing from all sources—from the private sector as well as from the public sector—and to achieve maximum value from that investment. We are offering people opportunities for home ownership and opportunities for new forms of social landlord such as housing action trusts. We want to promote partnership—between local authorities and housing associations, between public and private finance and between social and private landlords. More importantly, we want to promote partnership between all those groups and the tenants themselves. We are seeking to improve the effectiveness of public sector investment and are attacking incompetence by local authorities.

Those policies run with the grain of people's aspirations and with the grain of market forces. For that reason, they are more likely to succeed than the somewhat muddled, uncosted proposals which the Opposition often put forward. Their blinkered approach to housing action trusts and large-scale voluntary transfers—being actively considered by Labour councils and supported in ballots of tenants—shows how out of touch they are.

The hon. Member for Hammersmith seems to think that he could increase spending on housing, without incurring the displeasure of the shadow Chief Secretary, by spending capital receipts. That is nonsense. The money is not just sitting in the bank doing nothing. The capital receipts are used to reduce the level of debt. Let me spell it out clearly. Those capital receipts have either paid off debt or are earning interest which authorities can use to service their debts.

If local authorities were told to spend those notional receipts, they would either have to borrow again, or the Exchequer would have to give authorities more subsidy every year to meet their debts. Either way, we would then have higher borrowing or public spending with the usual impact on interest rates and the public sector borrowing requirement—and the raised eyebrow of the hon. Member for Derby, South (Mrs. Beckett).

One cannot use those capital receipts without it having an impact on public expenditure. That money is not just sitting in the bank doing nothing.

Mr. David Winnick (Walsall, North)

Why will not the Minister recognise that so much of the hardship and misery with which almost all Members of Parliament are involved through their case work, correspondence and surgeries is due to the fact that, in the past 12 years, council house building has come to a virtual stop?

If the Minister says, "What about the private rented sector?", he should know that in Monday's Evening Standard there were hardly any flats—leaving aside one-room accommodation—under £120 a week. They are usually modest flats, but most cost more. Does the Minister realise that people who are in so much need cannot afford to buy, even with lower interest rates? They can get nowhere with the local authority because of Government policy and can get nowhere with the private rented sector.

Sir George Young

On Monday I visited Walsall—part of the borough which the hon. Gentleman represents. During my discussions with the council it appeared that money that I had allocated to Walsall for housing had been spent not on housing but on other services. The local authority was asking me for more money for housing when it had reallocated money already voted for housing to other purposes. I found that deeply unimpressive.

Mr. Winnick

Will the Minister give way, because I can give him an explanation?

Sir George Young

I asked the chairman of the housing committee for an explanation and found it deeply unconvincing.

Mr. Winnick

Will the Minister listen to my explanation?

Sir George Young

No, I should like to make progress. Perhaps the hon. Gentleman will catch your eye, Madam Deputy Speaker, and make his own speech.

Mr. Soley

Will the Minister give way?

Sir George Young

No.

Mr. Soley

rose——

Madam Deputy Speaker (Miss Betty Boothroyd)

Order. The Minister has made it clear to the House—there is nothing wrong with my hearing—that he will not give way again.

Sir George Young

The hon. Member for Hammersmith said that he would speak for 20 minutes and then spoke for 35 minutes. I hope that other hon. Members can be called, but they will not if I continue to give way.

Those who live on council estates are rightly concerned not so much with the global sums, the billions of pounds, but with what is actually achieved: the quality of service and the range of choice that they are offered by their landlord. In some cases, local authorities use their resources and manage their stock well. Sadly, in others they do not. In some—mostly Labour-run authorities—resources have been poured in by the Government year after year with little to show for it, because those authorities have mismanaged the funds. They do not apply them where they will have the greatest and most beneficial effect and they do not involve the tenants, or voluntary or private sectors to get the benefit of their knowledge and experience. In short, they use no initiative and show no inspiration in dealing with housing problems.

One has only to look at Meadow Well in Newcastle or at some of the worst estates in Liverpool to see what effect they have had. Keva Coombes, the former leader of Liverpool council, said: Tenants get an appalling service, and they know that. I think probably the fundamental cause is, frankly, we've put the interests of the providers of the service, the workforce, above the interests of the tenants". He also said: We are the worst landlord in Liverpool, probably in the country…voids gone up, rent arrears soared and breaking the law on racial equality". Manchester has 6,000 empty properties—more than any other local authority. Four Labour-controlled local authorities in London failed to collect nearly one third of rents in 1989–90. To overcome problems like that, we have introduced a significant change in our approach. In future, in allocating capital resources to local authorities, we shall rely less on allocation by formula and more on an assessment of the quality of authorities' plans, to direct resources to those councils where they will be used best. In that way, we shall get better value for money, tenants will see tangible results and standards will rise as authorities realise that they need to make a greater effort in order to gain support. We want to hear not only about problems but about solutions.

The Labour party has resisted wave after wave of innovative Government policies until finally public opinion overwhelms it. One of the most recent examples of that attitude has been towards housing action trusts. Originally implacably opposed to the idea that rundown estates should be handed over to the tenants, housing associations and the private sector, Labour now finds itself in the embarrassing position that many of its own councils are pressing for HATs in their areas and tenants are voting to leave the control of those councils. So far, the Labour party has taken only one grudging step back and agreed to honour any existing contracts into which existing HATs have entered, in the unlikely event of their gaining power. But the waves are lapping round their feet and soon they will have to beat a full retreat as HATs become more popular and the Labour party's opposition to them another potential vote loser.

We must make better use of existing stock. In too many cases, authorities take too long to re-let vacant properties. Homes stand vacant while families awaiting rehousing have to stay in bed and breakfast. If all authorities achieved an average target of six weeks in London and three weeks elsewhere, the effect would be equivalent to 17,000 extra lettings in England, compared with 13,000 families in bed-and-breakfast accommodation. It may sound obvious, but it is important that local authorities should know who is living in their stock. It is just bad management that on many estates authorities have no accurate record of the people occupying their properties and some of those people have no legal right to be there.

Finally, on the problem of those who literally have no home—the rough sleepers—considerable progress has been made as a result of my Department's £96 million initiative to help people sleeping rough in central London. Hon. Members need not take my word; they can ask the voluntary organisations. In total, 1,500 places have been provided in less than a year and taken up by people who were sleeping rough or were at risk of doing so. Moreover, 176 spaces are still in use in shelters that we opened last winter. By March 1994, the total additional permanent housing generated by that initiative will provide accommodation for 1,800 people. The measure has already made a significant contribution to the housing needs of single homeless people in London. I take this opportunity to pay tribute to the many voluntary groups and housing associations that have helped us to make this possible. It is our stated aim to make it unnecessary for anybody to sleep rough on the streets of central London. We have introduced more than money and hostels; we have introduced an integral approach, with training, employment and health.

More needs to be done to achieve our aims. I am today announcing a new package of measures to help single homeless people sleeping rough in London and around the country. In London, where the problem remains at its most acute, I have set aside £1 million for voluntary groups to enable them to provide up to 300 places in emergency shelters this winter. Those places will be open regardless of temperature. I am pleased to say that nearly 200 places will be available next week. That provision is part of a co-ordinated programme which we are funding through Single Homelessness in London. We are making it as easy as possible for rough sleepers to use those extra places: they are free; people will not be required to give personal details if they do not wish to; and we are providing the outreach workers with vans to take rough sleepers to the shelters from pick-up points across the capital. Information on vacancies will be readily available, primarily from the Shelter Housing Aid Centre's hostels vacancy project and, out of office hours, by Shelter's nightline. Both projects are funded by my Department. SHIL has done well in its speedy organisation, as have the other voluntary organisations involved in setting up the programme.

I am also announcing today that funding for the programme of grants under section 73 of the Housing Act 1985 to voluntary organisations for the homeless throughout the country will increase from £4.5 million this year to £6.1 million in 1992–93—an increase in real terms of around 30 per cent.—and to a total of nearly £20 million over the next three years.

Dr. Keith Hampson (Leeds, North-West)

Will my hon. Friend give way?

Madam Deputy Speaker

Order. The Minister has made it abundantly clear that he will not give way.

Dr. Hampson

Not to every hon. Member.

Sir George Young

I hope that my hon. Friend will understand that I wish to bring my remarks to a conclusion.

Some 93 voluntary organisations, more than 60 of them outside London, already receive grants under this programme for a variety of projects providing practical help to homeless people. I am today inviting voluntary groups outside central London to apply for the extra resources available for 1992–93. In assessing their bids I shall give priority to imaginative new projects offering direct, practical help to single homeless people in areas with significant numbers of rough sleepers.

Dr. Hampson

rose——

Madam Deputy Speaker

Order.

Sir George Young

The policies being pursued by the Government are designed to provide the improvements in housing and higher standards that people want. More people are now housed, in better conditions, than ever before. More people own their own homes and the vast majority of them are meeting their housing costs. We have moved away from the old municipal paternalism so loved by Opposition Members towards arrangements that give people choice and opportunities to control and influence their own housing. Monopoly of housing tenure led to a decline in standards, and an absence of fresh ideas and solutions. That must have been as clear to the Labour party as it was to us, yet it has systematically opposed all our policies aimed at redressing the situation, from right to buy to HATs, grudgingly accepting them years later when they have shown that they are effective and popular. The Labour party wants to retain a power base for its councils rather than provide what tenants want. The diversity made possible by this Government, through owner occupation for many, influence over management and the use of resources for others, offers the best way forward. I urge the House to support the amendment.

Dr. Hampson

On a point of order, Madam Deputy Speaker. I hate to do this to you, Madam Deputy Speaker, but in the interests of Back Benchers I feel that I must. It is exceptional and unusual for the Chair to decide when hon. Members do or do not accept interventions. As the Minister made no comment on the last part of the Government motion, and as the distribution of housing corporation funds to northern cities is critically important, he might at least have been given a chance to comment on my case.

Madam Deputy Speaker

I am not sure whether the hon. Member for Leeds, North-West (Dr. Hampson) was in the Chamber when the Minister made it clear on more than one occasion that he would not give way again. As he made that statement, I consider that his decision holds good for all hon. Members.

5.41 pm

Dr. Ashok Kumar (Langbaurgh)

In addressing the House today I bring a strong message from all the people of Langbaurgh who cast their votes in the by-election on 7 November. During my time in the House I intend to speak for all those voters and represent, to the best of my abilities, the needs and aspirations of my constituency and the wider northern region.

It has been said that Langbaurgh was discovered by the national media during the by-election, and many representatives of the media were amazed to find—to quote The Times— the constituency was surprisingly beautiful. I suspect that many of the people who flocked into the constituency from outside—the media, the party hacks and the pollsters—were surprised to find, not grim steelworks or a photo-chemical smog, but pleasant villages and estates, and attractive countryside and coastline. That is not to say there are no problems in my constituency—there are. Many of them are common to the whole northern region: unemployment, under-investment, isolation and Government indifference. It was due to the popular recognition that the Labour party intends to tackle those problems boldly and head on that I was returned to the House.

I represent a constituency that is a microcosm of British society. It includes former mining villages, large council estates, market towns, seaside resorts and leafy suburbs. It was that cross section of British society which returned a Labour Member to the House, and which will return a Labour Government at the next general election.

Langbaurgh was previously represented by Richard Holt, whose death precipitated the by-election which became a vote of confidence in the Government whom he supported. His time in the House was marked by a style of politics which, it could be said, led to his success in bucking the electoral trends in both 1983 and 1987. Certainly, the House will be less colourful and quieter with his departure.

I also feel a deep sense of humility in following in the footsteps of Labour's pioneers in the area now covered by my constituency. The Labour party has never been afraid to field candidates who will, with vigour, promote the principles that they were elected to defend. I recall the Labour party's first Member of Parliament for the east Cleveland district, Billy Mansfield—an ironstone miner who left school at 13 and throughout his life, from the pit face to Parliament, fought for his class and his people. I also remember Ellen Wilkinson who colourfully represented the old Middlesbrough, East constituency throughout the early 1920s. She proved that a woman could successfully promote the needs, aspirations and dreams of a heavy, industrial region that conventional wisdom then held could not be won by anybody other than a man.

I am proud and humble to be following that historic tradition and I will not shirk from being single-minded in fighting for the rights of my constituents. The great tragedy is that many of the social evils that those pioneers fought are with us again today. The simple fact is that far too many of my constituents are still unemployed, exist on low wages and are being denied access to the vital health and social services that they need to live a more healthy and less stressful life.

It is little use senior Ministers telling local people that the recession is technically over. They should try telling someone who has lost his house that it was a technical repossession or someone who is still waiting for an urgent operation that he or she feels only a technical pain. Many of my constituents suffer from severe housing problems. Too many people are still inadequately housed, too many young people are still waiting for their first proper home and too many people in the villages of east Cleveland are still living in pre-1919 terraced houses that are long overdue for renewal and modernisation. A crying local need that is given public voice through Langbaurgh borough council's housing needs survey is for low cost accommodation for low wage earners.

The distress that unemployment, poor housing, idleness and ill-health brings should be self-evident to everyone. It is evident to everyone except, it seems, for the Government's Front Bench team. In parts of Langbaurgh—in many of the isolated villages of east Cleveland and on south Middlesbrough council estates—high and continuing unemployment has become a feature of everyday life. For the one in seven of the total working age population who are unemployed in the south Middlesbrough area of Hemlington, or for the 19.8 per cent. of men who are jobless in the steelmaking town of Skinningrove, life is becoming ever more mean and brutish. The social isolation and poverty that comes with such unemployment is biting deep into the very fabric of our local society, and it is not so unexpected, is it, that such alienation has led to problems of split families, mental and physical distress, and the various manifestations of crime, vandalism and other forms of anti-social behaviour? That is not to say that crime can be excused—it cannot. But crime must not be used as an excuse for doing nothing about unemployment.

During my time in the House I intend, in particular, to campaign vigorously for the total regeneration of my constituencys' economy. I will be fighting with my other Labour parliamentary colleagues on Teesside for more inward investment, for help to diversify and strengthen our local industrial base, and for vital Government and European funding to modernise and rebuild our physical, environmental, social and training infrastructure.

The centrepiece of that work, that crusade, will be a new northern development agency. It will sweep away the collection of non-accountable, unelected quangos that pose as the Government's answer to regional needs. The agency will spearhead a new regional renaissance, bring clarity, cohesion and commitment to the need to renew the north of England. It will have responsibility for property assembly and development; and assist start-ups and growing firms. It will help to set up a northern export agency and, above all, help the technological uprating of northern industry.

During the by-election I launched what I called a 10-point economic plan—a blueprint for Cleveland. That will be a programme for action in the run-up to the general election and a checklist for the action that the coming Labour Government will undertake through the support of the northern development agency. That programme will help to revive and regenerate our local economy. It calls for urgent action to pull Langbaurgh and the wider Cleveland area out of the vicious spiral of decline, dereliction and distress. It identifies the essential components, the key demands, of what I intend to call the new deal for Langbaurgh.

First, as a practising research scientist I am only too aware of the need for pure and applied research within our industry and commerce linked to our university academics. We desperately need a technologically advanced economy. We need to set up a new and innovative Teesside technology trust, an instrument to effect proper collaboration between industry, local institutions of higher and further education, regional financial institutions, local councils and training providers and, of course, the European Community. That will provide the structured environment in which local industry can identify its technology and research and development needs, liaise strongly with the public sector and work with local academic institutions.

As I have already said, I welcome the fact that the coming Labour Government will set up, as part of the popular move towards regional government—a move which I whole-heartedly support—a northern regional development agency. I intend to see that firms in my constituency benefit from the work of that agency, which should set tough but realistic targets for local jobs created and for local investment.

I also intend to fight for the creation of a one-stop shop for local industry so as to stop the bureaucracy and confusion of five different Government Departments all attempting to help start-ups or small and expanding businesses. This office would work with local councils, local enterprise agencies and a democratised enterprise council to offer a direct business advice service. Crucially, I want to see the launch of an emergency jobs and training package for my unemployed constituents. That package could include direct job experience—training and job seeking opportunities provided under one roof.

As those who are close to me and those who witnessed the by-election campaign know, I have always argued that individual opportunity and the economic success of one area are linked. Our economic destiny—nationally as well as locally—will be largely determined by the skills and talents of local people. We need to create a training scheme for local people and local industry. It is not enough to try to force local people and industry to conform to a remote central training plan devised and monitored by distant civil servants or by the shadowy private offices and right-wing think tanks servicing the employment Ministers. But that by itself is not enough. We need to see that all local people are able fully to participate in the local labour market. There must be a level playing field so that all people can exercise their talents and ability.

Problems of disability, special needs, or the availability of child care facilities should not needlessly deny someone the chance of competing equally in the jobs market. I intend during the coming weeks—as a matter of urgency—to begin discussions with Cleveland local education authority and the local voluntary sector to formulate proposals for a properly funded and wide ranging child care strategy for Cleveland.

The issue of industrial pollution figured prominently in the by-election campaign. Environmental awareness is now a key feature of everyday life in Cleveland. Local industry, which is often unjustly attacked, is trying hard to improve its record on pollution and environmental care. It has got little or no help from the Government in undertaking this responsibility. As a trained scientist, I am well aware of the scale of the problem and of the means and resources needed to tackle it. I want to promote a new Cleveland-wide programme of applied research into new pollution control, waste minimisation and recycling measures and technologies that will serve to make the county of Cleveland and its industry an internationally recognised centre of excellence in the nation's arid the industrial world's battle for a cleaner, greener and more sustainable environment.

Langbaurgh, Cleveland and the wider northern region realise—perhaps more than the Government—that we are living in a world where new trading partners and new markets are developing at a headlong pace. The advent of the single European market and the implications of the Maastricht summit will affect us all, and none more so than those who, if nothing is done, could he consigned to the periphery of what may well prove to be the most important global trading bloc of the 21st century. By contrast, the Government seem interested only in placating or fooling as many of their Back Benchers as possible for as much time as possible over the full implications of an issue which cannot go away, however much the Government might wish otherwise. We recognise the importance of our new European home, even if the Government do not, and I shall continue to press for more investment to ensure the maintenance of Langbaurgh's essential trade with Europe and to see that the links to the channel tunnel, our local ports and our local Teesside airport are as well resourced as those of our competitors on the European mainland.

Finally, and most importantly, we need a totally new regional policy. But this cannot be just a faded imitation of the regional policies of past Governments—Labour or Tory. The problems are greater and the challenges more pressing. Langbaurgh, Cleveland and the northern region have suffered draconian cuts in regional assistance and regional funding since 1979. Regional assistance for the counties of Cleveland, Durham, Northumberland, Cumbria and Tyne and Wear has been progressively cut by almost two thirds, a drop of about £3.4 million between 1979 and 1987. In the same period the region has experienced the biggest decline in manufacturing investment of any area in the United Kingdom—a decline of some 42 per cent. Under this Government, this gloomy catalogue of disaster, depression and decline is continuing. Figures from the jobcentres in Cleveland clearly show that there has been a drop of some 27 per cent. in registered vacancies since this time last year, and that the pattern shows no sign of abating.

I know that Conservative Members would love me to speak about Cleveland county council. Above all, we desperately need to create sources of regionally-based finance capital, the cash that is needed if firms are to expand, start up or carry out technological uprating. Some far-sighted Labour local authorities in the region are already making great strides towards this goal. In particular, I congratulate Cleveland county council on its imagination and daring in setting up a locally based and locally run £5 million venture capital fund. That is a valuable weapon in the fight to revive Cleveland's economy. Such an initiative will be closely partnered and needs to work closely with my proposed northern development agency and the new national investment bank which will be set up by the next Labour Government, and which will play a key role in areas such as Langbaurgh in the mobilisation of private capital for publicly-led long-term investment projects to improve, enhance and uprate the infrastructure needed to sustain the economic growth for which my constituency is crying out.

I want to stress again, so as graphically to underline the point, that Labour's victory at Langbaurgh has shown that the country wants change, is crying out for change, and is determined, at the polls next spring, to force radical change. In a famous debate in the House in 1940, a leading member of the then Labour Front-Bench team, Arthur Greenwood, was begged to "speak for England"—an intervention that led to a change in Government. Over a half a century later, the people of Langbaurgh have spoken for England and their voice is finding an echo throughout the land. I both hope and believe that that voice will have the same result.

6 pm

Mr. Paul Channon (Southend, West)

I am sure that I speak for the House when I say how much we appreciated the maiden speech of the hon. Member for Langbaurgh (Dr. Kumar). I am sure that the House will congratulate him on the excellent way that he delivered it, and on his courtesy, clear speaking and the interesting things that he had to say. Nobody yet knows whether his stay in the House will he long or short but, whichever it is, I hope that he will be happy and have an enjoyable and successful time here.

We appreciated the hon. Gentleman's references to our late colleague, Mr. Richard Holt. He is much missed on these Benches and throughout the House, and it was good of the hon. Gentleman to pay tribute to him—we shall not forget it.

I know the hon. Gentleman's constituency fairly well. It is a constituency of many contrasts. It is possible that, when the hon. Gentleman next speaks, he will find that the House does not agree with everything he says, especially if he repeats his last few remarks. However, tonight we shall not disagree with anything he said, at least not in public. I offer him many congratulations.

I shall try to be brief, because many of my hon. Friends also wish to speak. I start by declaring an interest, as trustee of a charitable housing association. It is building a project in the constituency of the hon. Member for Langbaurgh, but I have not yet visited it.

I do not often speak in housing debates. The last time I did so was in 1973, when I moved the Second Reading of a housing Bill, which the Labour Government took over and which became the Housing Finance (Special Provisions) Act 1974. I mention this because, the more I have listened to the debate, the more it has become clear that the old controversial arguments have not changed.

Furthermore, it is also clear that, when both sides of the House agree on housing policy, we make progress, but when they cannot, we do not. In the 1960s and 1970s—I give credit to the Labour party for this—the improvement of older housing became a great bipartisan cause. In the 1970s, we all supported the voluntary housing movement, which the Bill that I introduced and the Act from the Labour Government did a great deal to support. All this shows that, when we agree, we have successes, and when we disagree, we have disasters.

I do not wish to be controversial tonight, particularly as we do not have much time, but as the hon. Member for Hammersmith (Mr. Soley) criticised the Conservative Government for bringing about the decline in the private rent sector, I should point out that the decline has gone on for a very long time. The Labour party's attitude towards rent control and the privately controlled sector, which has been maintained for a long time, has been largely responsible for the decline.

As I understand it—no doubt the hon. Member for Knowsley, North (Mr. Howarth), who is to reply for the Opposition, will correct me if I am wrong—there is a suggestion of confiscation if private tenants are to have the right to buy. Perhaps he will tell us exactly what the Labour party's policy is.

I very much welcome—indeed, I wish I had the chance to do this myself—the way that my hon. Friend the Minister has boosted the housing association movement. The number of houses in this sector has risen from 200 to about 500,000. I am certain that that will increase still further. I believe it to be a very important factor in the medium-term housing situation. I am sure that, after the next general election, there will be many more housing action trusts, and many more local authorities will want to transfer their properties to housing associations.

There will also be a welcome increase in the amount of housing being built by the housing association movement. My right hon. Friends in the Department have managed to double the budget from just over £1 billion in 1991 to £2 billion in 1994–95, and 120,000 voluntary housing association houses will be built over the next three years. That is a great step forward, and I believe that it is the way forward for housing in the subsidised sector.

I welcome the three-year approach, which will allow housing associations to plan their programmes properly. It was ridiculous that, in the past, a housing association would not know with any certainty what approvals it would get or how much money it would have beyond the end of the year. It is now much more likely to be rationally organised, and I congratulate my right hon. and hon. Friends on that.

I also congratulate them on their approach to getting private finance. I am sure that we should get value for money in this sector so as to ensure that every penny of public money is spent in the best way to provide more housing for the people who so desperately need it. My hon. Friend the Minister has also launched a study recently into ways to attract yet more private finance into the housing association movement. I hope that he will be able to tell us how long the study will take and how he sees the way forward.

Could not the Housing Corporation, which has large funds, do more? Is there no way, without breaking the public expenditure rules, to allow the Housing Corporation to invest or to go into partnership with a bank or the Housing Finance Corporation or a similar organisation? That would increase the amount of money available to be lent to housing associations, and lead to an even larger housing programme. Perhaps the answer is a mixture of public and private money—I do not know. Such a body might be able to lend at a better commercial rate, which would mean that houses would be cheaper and rents lower. I hope that the Minister's inquiry will look at that and other similar proposals.

I ask my hon. Friend the Minister to be careful about one point. It is true that costs are going down and that it is therefore reasonable to make a change in the total cost indicators. However, when housing associations plan a big housing scheme, they plan a long way ahead. They have to make some assumptions about future interest rates, and when they make proposals, they base them on such assumptions. If there are then frequent changes in the cost indicators and the grant is reduced, that is threatening for housing associations. I ask not that it should not be done but that it should be done infrequently, and that more notice should be given. That would mean more stability and confidence in the housing association movement.

Will my hon. Friend look at the way in which homeless figures are recorded? Housing associations are probably doing much more to help the homeless than is shown in the figures. For example, I know of a case where a housing association bought a block of flats from some developers and allowed the developers to nominate to those flats. That vacated other flats that the developers had into which homeless people went. That did not show up as a single gain for the homeless in the statistics. There are many similar ingenious schemes around, but they are not sufficiently apparent to show how the housing association movement is helping to alleviate homelessness.

The hon. Member for Hammersmith concentrated on mortgage repossessions. We have all heard of terrible cases in our constituencies. Anything that can be done is good, but we can do even more with housing associations. I was glad to hear what he said about the initiative on empty properties. Can we not have an even more active policy so that housing associations know all the practices among other housing associations?

For example, if a housing association can buy a house from someone who has fallen in arrears with his mortgage, it should try to keep that family living there if that is possible. The hon. Member for Hammersmith criticised the Government's scheme, and I agree that it is a disaster if people have to be moved from repossessed properties into bed-and-breakfast accommodation. If a way can be found to keep them in their property, perhaps with a housing association managing it or acting as agent for the local authority, or encouraging the shared ownership about which my hon. Friend spoke, that would be much better. To do that, we need to study the best practice of housing associations. We need some imaginative scheme to help people who fall into arrears but who have not fallen into complete financial chaos.

I strongly support the Government in their desire that the voluntary housing movement should be the main provider of social subsidised housing. The expansion of the voluntary housing movement is having an excellent effect on local authorities. Local authorities which face the prospect of losing their housing stock to a housing action trust will pay much more attention to their tenants than used to be the case.

When the housing association movement grows and many more houses are transferred to it, as will probably happen, I hope that my hon. Friend will continue to keep an eye on it. There is no point in a transfer for the sake of it. The object of a transfer is to give the tenants a better deal. The day may come, although not for some time, when large housing associations have to be split up to prevent them from becoming unwieldy local authorities in their own right. The process of reform will have to be kept continually under review.

No housing association has a large enough stock to be in such a situation now, but if they are not good enough and if they become impersonal and do not give the tenants the service they should, they should be subject to the same criticism as local authorities in a similar position. The point is to provide a better service and a greater opportunity to provide houses using public and private money to the best advantage.

There are many other topics that I should have liked to talk about. The policies that my hon. Friend and his predecessors have pursued during the past few years, particularly last year—the new form of tenure, the new partnership, the maximum value for money, the mixture of public and private funds and the new forms of landlord—offer great hope.

As we all know, there is at present a short-term difficulty. My hon. Friend is right to say that a reduction in interest rates would be the best news for those in difficulty with their mortgages, but in the medium term, my hon. Friends have laid a good foundation for British housing. I commend them, and I shall vote with enthusiasm for the amendment.

6.11 pm

Mr. Ronnie Fearn (Southport)

After 12 years of office, the Government have little to be proud of when it comes to housing. They have presided over record levels of homelessness, record rent levels and record levels of house repossessions. The hallmark of any civilised society is its ability to house its citizens properly. People have a fundamental right to decent affordable housing, a right that the Government attempted to capitalise on with their ideology of a property-owning democracy. The right-tobuy policy was the Government's flagship in 1980, but because it was implemented as part and parcel of Conservative mania to reduce public spending and to restrict the powers of local government, it has contributed to the present scandalous homeless and housing crisis which is growing all the time.

Shelter's most recent report put the number of homeless people at 350,000. Some estimates are set even higher, at 500,000. As many as 8,000 people sleep rough every night. Age Concern believes that 30 per cent. of those people are over 50 years of age, many of them with disabilities. But the number of disabled persons who are homeless arid on our streets are not just among the elderly. The November issue of Disability Now quotes a new survey in Nottingham carried out among 50 homeless people between the ages of 16 and 25, which found that the majority had disabilities.

How the Government can come to the House today and call that a success is beyond belief. It is a disgrace. We are a supposedly civilised society approaching the 21st century, we have wonderful technology and great expertise, we play our part on the world stage—yet we fail miserably when it comes to housing our people.

The previous Prime Minister held up a dream of home ownership. The Government raised expectations but failed to deliver to thousands of people. Not only that, they also took away the choice of how people housed themselves. The right to choose figured prominently in all the Government's rhetoric, but when policies were implemented, choice was eliminated for most people.

The Government's housing policy was aimed at home ownership, to the detriment of the provision of affordable housing to rent. Many people looking for somewhere to live had little choice but to buy, often with 100 per cent. mortgages. For others, the opportunity was a dream come true. They believed the rhetoric and entered the property market. I accept that many of those people have never looked back, but thousands of others have.

Mortgage repossessions have reached record proportions throughout the country. As many as 100,000 to 120,000 houses will have been repossessed by the end of the year. With the current level of people in arrears running at 750,000, of which 162,000 are more than six months in arrears, that figure is set to go even higher next year.

The situation could be made worse if and when the housing market picks up because at the moment some building societies are holding back from repossessing because of falling house values. As soon as they see a turn in the market, they will begin the repossession process, and many more families will be evicted.

The Government are in for a nasty shock. Come the general election, they may find themselves evicted from the House, but that eviction will be the result of their own actions, unlike the fate of many of the homeless and those who have had their homes repossessed.

The Government have mismanaged the economy, introduced high interest rates, implemented housing policies but neglected the need for social housing and presided over the boom and bust cycle which has contributed to the depressed housing market. In recent weeks, the Government have tried to talk up the economy, but they have failed to convince anybody that recovery is around the corner.

It is not difficult to see why the Government have failed when industries such as the construction industry are on their knees. As Sir Clifford Chetwood, chairman of Wimpey, was reported as saying in The Guardian on 26 November, the construction industry is in "shocking crisis", with no prospect of a return to growth until 1993. He has forecast 250,000 job losses by next summer, with as many as 5,000 firms going to the wall before the end of this year. He says that the country is on the brink of a housing crisis with a shortfall of 1 million homes.

Some of us have been only too aware for a long time that housing in Britain was in crisis. Most of us have only to look around to see the homeless on our streets or to visit some of the homeless organisations such as the Simon community, which I have visited twice. There are many in that community who are sleeping rough. I expected there to be 40 in Lincoln's Inn Fields, but when I went, there were 260 people. Most of them have jobs; none of them have homes because they cannot afford the three months' rent.

With the construction industry depressed, with some building societies and mortgage lenders in trouble and with unemployment continuing to rise, the housing market is set to continue to fall, and Britain's economic recovery will be further delayed. The Government must take the initiative and look to ways to reduce repossessions and the number of homeless and to provide more homes for rent.

In the short term, much can be done which will have some immediate effect. The recently announced scheme to allow housing associations to take over repossessed homes to house homeless families for a year is a beginning, but if that is to be the only scheme, it is somewhat misguided. There is not much sense in turfing one family out into the cold in order to house another which, on present trends, will be homeless again within a year unless there is some guarantee of permanent housing.

The Government must use their initiative and power to prevent repossessions in the first place. They must introduce sensible mortgage rescue schemes. The transfer of mortgages to shared ownership schemes with local authorities and housing associations is one such scheme which will work. Local authorities already have the power to set up mortgage rescue schemes with housing associations, but the Government should find ways to encourage the extension of such schemes.

Mortgage lenders must take some of the blame for the current repossession crisis. I was pleased that the Minister mentioned that. Far too often in the past, lenders have been, if not irresponsible, over-enthusiastic. I do not want a return to the days when it was virtually impossible to obtain a mortgage, but I feel that lenders should be more responsible. Perhaps they will be: there is nothing like a nasty case of burnt fingers to restrict lending.

Mortgage-to-rent schemes should also be encouraged, since they would benefit lenders as well as families in arrears. Rather than selling at auction, possibly at a loss, lenders could hold on to properties that might appreciate in value, while continuing to receive a regular income from those properties. Tenancies could be short or long term, and, if necessary, housing benefit could be provided to make the rent affordable. If such schemes are to appeal to building societies, they may have to be administered by local authorities or other housing agencies. A shared-ownership scheme would also benefit both lenders and families in arrears.

Another possibility is a mortgage-to-rent scheme with the option to buy back. Regardless of which scheme is introduced, however, Liberal Democrats recognise that the lenders would need some assistance. We suggest that the portion of income support that is allocated for mortgage repayments be paid to them directly.

Other problems also need attention urgently. The Government must tackle homelessness in general. To help young single people, we advocate reform of the social security system, enabling income support to be paid in advance and restoring the full rate of income support to the under-25s. Family credit entitlement should be adjusted to reflect liability for mortgage interest payments.

The Government should also investigate the possibility of a housing benefit allocation that takes into account mortgage interest payments. I understand that reducing mortgage tax relief from 25 per cent. to 23.5 per cent. would release £400 million—the estimated cost of paying housing benefit for mortgage interest payments. That information is contained in a report by the Council of Mortgage Lenders entitled "Time for Mortgage Benefits", which is due to be published later this week. Perhaps the Minister will look at it.

The lifting of the restrictions on capital receipts from the sale of council houses would provide an immediate injection of cash for the housing market. It would provide more homes, and it would also create jobs. Our party's programme would increase the percentage of council house and land sale receipts that can be spent by local authorities from 25 per cent. to 75 per cent. when the money is to be spent on repairs and renovation.

The Government's housing policy has led to many untenable situations. Let me give an example of the ridiculous state of housing finance and the false economies that have been made. Because of the lack of affordable housing to rent, and the lack of funds to bring poor housing up to standard, many local authorities have to resort to providing bed-and-breakfast accommodation. According to the Audit Commission figures for 1990, the cost in the first year of such accommodation in London is £15,540; the cost in the first year of building a home to rent is £8,200. Outside the metropolitan districts, the figures are £5,475 and £5,000 respectively. Those figures speak volumes about the absurd way in which the Government run their housing policy.

So far, the Government's response to the housing crisis has been dismal. Palliatives are not enough; we need fundamental change. Unless the Government take action now, the nation's housing needs will continue to increase and the current state of affairs will continue to go downhill.

6.24 pm

Sir Timothy Raison (Aylesbury)

The debate has been marked by three speeches in particular. First, there was the maiden speech by the hon. Member for Langbaurgh (Dr. Kumar), which was heard with much appreciation. Then there was the speech by my right hon. Friend the Member for Southend, West (Mr. Channon). I served on the Standing Committee that considered the Housing Finance Bill in 1972: that was the longest Committee stage that we had experienced, and it seemed even longer than it was. I was struck then by the enormous skill and patience with which my right hon. Friend handled the Committee: he provided a model for others. I support his view that progress can best be achieved when there is a measure of agreement between the parties.

As always, we heard a very good speech from my hon. Friend the Minister, who dealt effectively with the somewhat lengthy speech by the hon. Member for Hammersmith (Mr. Soley). My hon. Friend demonstrated that the Government care a great deal about the problems of people who are having difficulty in making mortgage payments, and that a number of effective actions are being taken. We were pleased to hear that, for real distress is plainly being caused.

There is no doubt that the measures that we took in the 1980s to widen home ownership were completely justified. I do not accept for a moment that the existence of the problems that I have just acknowledged undermines the enormous success and importance of that move. We all know that our policy in that regard will not be reversed by any other political party. However, we also know that housing policy cannot stand still. There are always new problems: we never reach a happy plateau on which there is nothing to worry about. We should be concerned about the difficulty of providing low-cost housing, for instance.

That difficulty is partly due to demographic factors. It is also due to family breakdown, which, sadly, is placing a good deal of pressure on housing, as most of us know from our constituency surgeries. We must tackle that problem. We could gain some useful assistance with overall housing strategy from the excellent report that followed the Duke of Edinburgh's inquiry into British housing, which came out in the summer. I should have liked to say more about that, but time is short.

My constituents are likely to experience worse problems over the next year or so. I hope that my hon. Friend the Minister will recognise that, and will ensure that our policies can help. The essence of the problem is the drying up of council building, and the lack of housing association building to offset that. Until now, we were doing reasonably well. Our building programme has worked, although there has never been much housing association building for general needs.

I fear that we are going to run into difficulties. Approval for new council building in my area has been ended. There has been a sharp drop from an allocation of more than £3 million in 1985–86 for Aylesbury Vale district council to £367,000 in 1991–92, and that allocation is for improvements, not new building. This year, the waiting list will probably double. The council operates an extremely restrictive policy—it is pretty hard to get on to the waiting list—and the position is set to worsen.

Homelessness increased by about 25 per cent. between 1990 and 1991. Only about 62 housing association units are planned for next year, and, while about 40 shared-ownership units were provided by the council this year, housing associations will provide only about 19 next year. All that will mean some fairly tough problems—not for me, because I shall not be standing in the next election, but for my successor.

Wycombe district council will need, it estimates, about 1,500 units of low-cost housing over the next five years. That is based on need; it is not simply a question of demand. According to present plans, it looks as though housing associations wil provide only 300 of those units. It is likely, therefore, that there will be a serious shortfall in Wycombe district council's housing provision. It has to provide for 700 homeless people this year and it has 200 people in temporary accommodation. What is happening in my constituency cannot possibly be unique. It must be happening elsewhere.

What can we do about it? First, we have to recognise the problems. I am sure that the Minister does recognise them. Secondly, I do not mind whether the problem is tackled by an increase in the amount of private rented accommodation, or by increasing the allocation to housing associations, or even by more cuts in council building. We still need a horses-for-courses policy. The problem must be tackled by one means or another.

The debate has focused primarily on mortgage payments, but I hope that the Minister will bear in mind that in many parts of the country low-cost housing presents real problems. In their amendment to the motion the Government rightly say that housing policy is not about just one issue but about a wide variety of issues. I am confident that the Government will bring forward measures that ensure that low-cost housing can be made available to people who badly need it.

6.31 pm

Mr. George Howarth (Knowsley, North)

This an Opposition Day. When the Liberal Democrats have a Supply Day I hope that the Chair will take into account the length of the speech of the hon. Member for Southport (Mr. Fearn).

The debate has greatly benefited from the fine and comprehensive maiden speech by my hon. Friend the Member for Langbaurgh (Dr. Kumar). He demonstrated his deep roots in the constituency and his detailed knowledge of the problems that face it, as well as the qualities of the constituency. He demonstrated also the analytical skills which, as a scientist, he brings to the House. He analysed the problems faced by his constituency in the context of the Government's policy. We shall be pleased to listen to my hon. Friend on many occasions in the years to come.

The hon. Member for Ealing, Acton (Sir G. Young) made a great deal of the recent 4.5 per cent. cut in interest rates. That is very important. However, the Minister failed to recall the fact that it was this Government who sent interest rates into the stratosphere. It is one thing to boast about a reduction in interest rates and the effects that may have had: it is another thing to claim credit for bringing them down, having sent them up into the stratosphere in the first place. Under this Government, average interest rates have been higher than at any time under any Labour Government. As my hon. Friend the Member for Hammersmith (Mr. Soley) made abundantly clear, the Government's record speaks for itself.

The Minister referred to the Labour party's response to housing action trusts. Occasionally, he is somewhat disingenuous when presenting his case, and this was one such occasion. The Minister sat as a Back Bencher all the way through the Committee proceedings on the 1988 Housing Bill.

Sir George Young

indicated dissent.

Mr. Howarth

The Minister intimates that he did not do so, but he certainly took a close interest in the passage of that Bill.

He will be aware that a series of amendments were tabled in that Committee, on Report and in the other place by my hon. Friends and me. The amendments would have made housing action trusts more open, in that they would have been the subject of a genuine ballot of the tenants and would have provided tenants with the option to revert to local authority control. The Government rejected all those amendments. We are able to say now that in certain circumstances, where there is local support, we are prepared to accept housing action trusts, because the amendments that we tabled at that time but which were rejected were ultimately accepted by the Government.

All parts of the House will accept as constructive many of the comments made by the right hon. Member for Southend, West (Mr. Channon). What I have just said, however, about housing action trusts undermines the right hon. Gentleman's point. The right hon. Member for Aylesbury (Sir T. Raison) also made a fairly constructive and in some respects progressive speech. I refer him to the motion, in which he will find much more to agree with than he will find in the Government's amendment.

The genesis of the housing crisis was during the former reign of the Secretary of State for the Environment, accompanied by the hon. Member for Acton, who, in his first incarnation as a Minister with responsibility for housing, was a member of the terrible duo that is now reinflicting itself on housing policy.

The housing problems that we now face were foreshadowed by the Opposition. We warned the Government that they would eventually have to be dealt with. I refer the House to the Committee proceedings on the 1980 Housing Bill, when my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said: The Secretary of State"— the same Secretary of State as we have now— who has the effrontery to talk about enough new house building to meet demand, is certain to leave office with the unenviable record of having not only presided over but deliberately brought about the worst housing programme since the war."—[Official Report, 15 January 1980; Vol. 976, c. 1559.] My hon. Friend the Member for Hammersmith has already made it clear that that prediction has come true.

Mr. Hood

Will my hon. Friend comment on the visit of the Moderator of the Church of Scotland to London yesterday, when he spoke at Dover house in Whitehall and reminded the Secretary of State for Scotland that 25 per cent. of all the homeless people sleeping rough in London come from Scotland? Is not the real cause of people sleeping rough the fact that we are not providing homes for them in their own part of the country?

Mr. Howarth

I am grateful to my hon. Friend. The hon. Member for Acton announced that about 1,800 places had been provided, as a direct result of Government initiatives, for people who otherwise would be sleeping rough. According to the Government's statistics, that means that between 7,000 and 8,000 people are still sleeping rough every night of the week. Those statistics were given to a Select Committee last year by the permanent secretary to the Department of the Environment. Either they have gone down, or they have stayed the same. It means that about 5,000 or 6,000 people are sleeping on the streets of London and elsewhere. The Government are complacent and smug. They have acted too late and have not done enough.

Sir George Young

rose——

Mr. Howarth

I shall not give way to the Minister, not because I am being discourteous but because he refused to give way earlier and took up over 30 minutes of the debate.

The genesis of the problem is the Government's policy of the early 1980s. Nothing illustrates more clearly the Government's appeals for people to become owner-occupiers than the words of the right hon. Member for Finchley (Mrs. Thatcher) at the October 1986 Conservative party conference: The great political reform of the last century was to enable more and more people to have a vote. Now, the great Tory reform of this century is to enable more and more people to own property. Those words are unwelcome to all those facing homelessness and repossession, who in good faith became owner-occupiers and now find themselves unable to cope with their commitments because of the recent high interest rates.

Let us not collude with any pretence that the repossession problem has not been created by the Government's relentless promotion of owner-occupation as the only housing solution. It is worth pointing out that by reducing the supply of rented accommodation, across all types of tenure, the Government have closed off many escape routes that might otherwise have been available.

The facts of the problem are a stark and sorry saga. About 85,000 repossessions are officially acknowledged and, by the end of the year, it is likely to be 100,000 or even 120,000. About 750,000 owner-occupiers are in arrears and are at risk of having their property repossessed at some time in the future if they cannot resolve their problems.

What is the Minister's response? One response is that of smug complacency. On "World in Action" earlier this week, the Minister said that most lenders are offering a range of options. He enlightened the House on those options today. Does he suppose that those 85,000 people who have already had their homes repossessed were aware of the options but simply ignored them and let themselves be put out into the street? Of course they were not aware of them and the Government have done nothing to make them aware of them.

The Government's recent announcement—another panic public relations exercise with no real substance—underlines their inadequate response. First, homes will be repossessed by building societies. Secondly, the occupants will have either to fend for themselves or to fall back on the local authorities for temporary accommodation. After being repossessed by a building society or bank, their home will, through a housing association, be rented to another family who have had their home repossessed. What nonsense. It is musical houses—when the music stops, everybody changes house. It does not have the fun of musical chairs, because the game involves thousands of human tragedies.

What is the politics of this? We should look at the November-December issue of Roof, in which the hon. Member for Southend, East (Sir T. Taylor) put his view succinctly: I have never seen such personal misery in all of my 25 years as a Member of Parliament. Perhaps more interesting is a source quoted as a senior Conservative whip—unnamed: It's now clear the balance has to be redressed between home ownership and renting. There's also a continuing need for social housing which we recognise—we're not daft". I take issue with the latter part of his remarks.

The hon. Member for Croydon, North-West (Mr. Malins) is quoted in the same publication: If people borrow more than they ought to, they will have to bloody well learn. There is plenty of sympathy there.

Perhaps we should take the word of the hon. Member for Leeds, North-East (Mr. Kirkhope): I haven't had a single letter on the subject. Unless I see figures which suggest otherwise, I won't believe that repossession leads to homelessness. Those are the views of Conservative Back Benchers. They are uncharitable, unkind and disingenuous, particularly those who claim that they did not know what was happening. Several of those hon. Members are sitting on majorities of fewer than 2,000 or 5,000, and the electorate will take their revenge at the next general election.

The figures for housing starts across all sections have been quoted. It is sufficient to say that new build in the private rented sector, local authorities and housing associations is on the decline. Inevitably, the gap between the supply of housing and the number of people who need it will grow and grow. The contrast is stark between what the Government are doing and the programme for a mortgage rescue package outlined by my hon. Friend the Member for Hammersmith.

Within days of taking office, a Labour Government will call in all the interested parties—local authorities, housing associations, building societies, banks and the agencies that deal with homelessness. We shall put together a crash homelessness package and mortgage rescue package to deal with the homelessness caused by the Government's years of inactivity. The Secretary of State and his Ministers have proved time and again during their two terms of office in the Department that they are unfit to deal with housing. Only a Labour Government will deal with it, and we look forward to the day—it will be soon—when we have an opportunity to do so. I urge the House to support the motion.

6.46 pm

The Parliamentary Under-Secretary of State for the Environment (Mr. Tim Yeo)

This has been a useful and timely debate, but not for the reasons that the Opposition intended. It has demonstrated beyond any doubt that the new thinking and well-informed contributions come from Conservative Members, while from the Opposition we hear nothing but bluster and ignorance.

I pay tribute to the hon. Member for Langbaurgh (Dr. Kumar) on his thoughtful maiden speech. We look forward to further contributions from him. I was interested in what he had to say. In Middlesbrough, not far from his constituency, was one of the winners of this year's city challenge initiative, with a bid that included a large housing element. The bid will tackle many of the objectives to which the hon. Gentleman referred. I hope that, as one of the 57 urban programme authorities, Langbaurgh will take the opportunity of bidding in the city challenge initiative next year, when it may receive extra funds from central Government to deal with the issues concerning the hon. Gentleman.

The hon. Member for Langbaurgh's reference to his predecessor, Richard Holt, was much appreciated by Conservative Members. I am sorry that Mr. Speaker was not here to listen to that reference, since I know that Richard Holt was a friendly adversary of Mr. Speaker.

There have been some first-class speeches during this short debate. My right hon. Friend the Member for Southend, West (Mr. Channon), a former Minister responsible for housing, showed that he has lost none of his grasp and expertise on the subject. We welcome the support that he expressed for housing associations. He was right to stress the importance of maximising the contribution that private funds can make to supplement the contribution from the taxpayers. Last year over £800 million was lent from the private sector to housing associations, and this year over £400 million is to be lent from the same source. My hon. Friend the Minister has put in hand a study of ways in which it may be possible to increase the flow of private finance. We hope to have the results of that study early next year.

I shall take note of my right hon. Friend's suggestion about total cost indicators and the frequency with which they are adjusted. I share his view about the desirability of promoting best practice among housing associations and others to minimise the rate of repossession.

In painful contrast to my right hon. Friend's speech, the House heard an ignorant and rather sour contribution from the hon. Member for Southport (Mr. Fearn). The less that is said about it the better.

My right hon. Friend the Member for Aylesbury (Sir T. Raison) made an eloquent plea about the shortage of affordable housing. The Government are addressing the matter urgently. We have doubled the funding of the housing association movement. I hope that my right hon. Friend's constituency and district council will receive a proper share.

I should like to make two further points to my right hon. Friend the Member for Aylesbury, one of which is relevant to all rural areas. Once a needs study has been conducted in a small rural village settlement, the exceptions policy allows a local authority to give permission for development on land that may have been obtained at nil cost or at a low cost that does not reflect its development value. That is one way of achieving a supply of low-cost housing in rural areas.

Using the same philosophy, in May we published circular 791, which encourages local authorities to negotiate with private developers for low-cost housing to be included in new housing schemes. I want local authorities to take advantage of that huge and exciting new opportunity. There is now a chance for them to play a proper enabling role, bringing together housing and planning departments to meet local housing need.

My hon. Friend the Member for Leeds, North-West (Dr. Hampson), who attempted to intervene earlier in the debate, made an important point about the Housing Corporation's distribution of funds to housing associations. I shall write to him about that.

Mr. Dennis Turner (Wolverhampton, South-East)

Will the Minister give way?

Mr. Yeo

No, I do not have time.

The hon. Member for Knowsley, North (Mr. Howarth) was off the mark in his statistics on rough sleepers. The census showed that there were 1,300 rough sleepers in London and 1,400 elsewhere, making a total of 2,700. The figures that are thrown around of thousands of rough sleepers are without foundation. I am glad to reiterate what my hon. Friend the Minister for Housing and Planning said: there will be 1,800 places in permanent accommodation for people who have been sleeping rough in London, in addition to 1,000 hostel places.

Mr. George Howarth

Will the Minister give way?

Mr. Yeo

No, I do not have time.

The hon. Members for Knowsley, North and for Hammersmith (Mr. Soley) mentioned mortgage repossessions, but they overlooked the fact that the Department of Social Security pays £500 million of income support a year exclusively to meet the mortgage interest commitments of income support claimants. That is a huge programme, which is likely to increase this year, and its effect is precisely to achieve the objective that we all share—to prevent repossessions.

The Opposition remain addicted to the solutions of the 1960s, regardless of their failure then and their irrelevance now. Their approach to the problem, and to almost every other problem, is to mouth carefully crafted phrases that are selected for their ambiguity. The purpose is to convey the message to the audience that Labour would spend more money on this or that group, but without giving a firm commitment.

That blatant attempt to deceive his clients is unworthy of a former probation officer such as the hon. Member for Hammersmith. It is a new form of fraudulent misrepresentation. It can usually be heard in the House when the hon. Member for Derby, South (Mrs. Beckett) is absent. If she were here, she might have to confirm that her priorities are confined to social security issues. I wonder whether the hon. Member for Hammersmith is able to say that Labour would spend that £100 million.

Mr. Soley

indicated assent.

Mr. Yeo

The hon. Gentleman is confirming that he would spend that. I am glad. I wonder how near the bottom of Labour's ever-lengthening list of spending promises that pledge is.

Mr. Soley

I have told the House a number of times, but I shall tell the Minister again, that we would save £50 million on the mortgage repossession bed-and-breakfast costs in London alone.

Mr. Yeo

That is certainly helpful clarification. I think that what the hon. Member is trying to say is that there would not be any new money.

The hon. Member for Hammersmith included 16 priorities in the document that he published this year, all of which were uncosted and no order of preference was given. The mortgage rescue scheme was one of the priorities. I should like to quote from another old Labour favourite: the lifting of constraints on direct labour organisations". I am not surprised that the hon. Member forgot to mention that, as today the newspapers have reported the illegal award of contracts to direct labour organisations by Lambeth borough council. That pledge will fill many tenants with absolute dread. I imagine that it was included at the request of the hon. Gentleman's cronies in the trades union movement. At least we can understand why he has not tried to put a price on it.

Either way, Labour's version of the mortgage rescue scheme seems to set some new benchmark in cost-effectiveness. It is startling, even by Labour's standards.For £100 million, whether it is new taxpayers' money or not, not a single new unit of housing is added to existing stock. For £100 million, as my hon. Friend the Member for Bristol, East (Mr. Sayeed) pointed out, only a tiny fraction of the families who are facing repossession would receive any help. It is not the wasteful use of taxpayers' money that characterises it as a Labour proposal but the typically dominant role that the hon. Member for Hammersmith foresees for local authorities.

That is the real hallmark. Whatever question one asks on housing policy, Labour's answer is always the same: give the local authorities more cash and, with any luck, they will use it to buy some more private sector homes. It is straight back to the council monopoly landlord: take away tenants' choice, drive out owner-occupiers and let the council take over. In Liverpool, that system left almost one council property in 10 empty. That system left almost a third of the rent in Lambeth uncollected, with a similar proportion in Southwark. More than £40 million should have been taken from tenants to repair and improve stock. Labour's vision of the future is the sink estates and unwanted tower blocks.

This afternoon, Labour has tried to portray the huge expansion of owner-occupation in the past 12 years as some kind of disaster. Seven million first-time buyers since 1979 could tell Labour that they know that it is not a disaster. One and a quarter million former local authority tenants who exercised their right to buy could tell Labour that it is not a disaster. The 49 out of every 50 mortgage payers who are not in arrears or facing repossession could tell Labour that it is not a disaster. All those people know that the growth of owner-occupation has been one of the huge success stories of the 1980s.

Just as we extended tenants' rights in the 1980s in the teeth of Labour party hostility, so we shall do the same in the 1990s. Whether it is tenant-led housing action trusts, rents to mortgage or large-scale voluntary transfers, tenants are enjoying new freedoms to choose their future—who their landlord is, how their estate is run and what form of tenure they should have. Just as Labour fought tooth and nail against the right to buy, so it rubbishes HATs, rent-to-mortgage schemes and large-scale voluntary transfers.

In the end, Labour saw the light of day and did a U-turn on the right to buy. Who knows, after 12 more years of glorious Tory government it may be forced, by popular support for those Tory initiatives, to do U-turns on them, too.

The extent of the Government's commitment can be seen in the huge resources that are being devoted to housing—not just the £7.8 billion of Department of the Environment spending but another £7.8 billion of tax relief to home buyers. That has increased two and a half times in real terms since 1979. Over the same period, spending on housing benefit has doubled in real terms to £4.6 billion. That is £17 billion of taxpayers' money in the form of cash and tax reliefs, in addition to the £1 billion of private sector lending that I have already referred to.

The Government have a multi-faceted approach to housing policy. We are promoting home ownership through the right to buy, rents to mortgages and shared ownership for families that cannot afford to buy outright. We are promoting the construction of more affordable homes under circular 791, which is opening up new horizons.

We are promoting a variety of rented properties in the private sector through the enormous growth in shared shorthold tenancies made possible by the Housing Act 1988, a growth which is now taking place at a faster rate than the decline in the old secure tenancies as they disappear. We are also promoting a range of other initiatives to bring back the landlord, such as the £25 million available for bringing back into use flats over shops.

On the local authority front, through the process of competitive housing investment programme allocations we are ensuring that, for the first time, the taxpayers' resources will go where they are most likely to be well spent. That is alongside a hugely expanded estate action programme and two housing action trusts which are now getting under way. That is all in addition to the extensive initiatives outlined by my hon. Friend the Minister for Housing and Planning in response to questions about repossessions.

The contrast between the two approaches is perfectly clear. Labour has a litany of uncosted promises, fraudulently financed. It is as careless with words as it is with money. Underlying its approach is a strong socialist theme—the municipalisation of private property, the crackdown on owner-occupiers and the removal of tenants' rights. We know what Labour's housing policy means in action. Unfortunately, we can see it in Lambeth, in Southwark, in Hackney and in Liverpool. It is the same old story—neglect the tenants, waste the money, run down the stock and outlaw the private sector.

The Conservative philosophy is that of a pluralist approach—higher spending targeted to get even better value for money, the private landlord recreated, home owners helped more than ever before, tenants given real freedom of choice and, above all, an end to the old local authority monopoly.I commend the amendment to the House and urge the House to reject the Opposition's motion.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 224, Noes 315.

Division No. 19]	[7 pm
AYES
Adams, Mrs Irene: (Paisley, N.)	Fearn, Ronald
Allen, Graham	Field, Frank (Birkenhead)
Alton, David	Fields, Terry (L'pool B G'n)
Anderson, Donald	Flannery, Martin
Archer, Rt Hon Peter	Foster, Derek
Armstrong, Hilary	Foulkes, George
Ashdown, Rt Hon Paddy	Fraser, John
Ashley, Rt Hon Jack	Fyfe, Maria
Ashton, Joe	Galbraith, Sam
Barnes, Harry (Derbyshire NE)	Garrett, John (Norwich South)
Barnes, Mrs Rosie (Greenwich)	Garrett, Ted (Wallsend)
Barron, Kevin	George, Bruce
Battle, John	Gilbert, Rt Hon Dr John
Beckett, Margaret	Godman, Dr Norman A.
Beggs, Roy	Golding, Mrs Llin
Bell, Stuart	Gordon, Mildred
Bellotti, David	Gould, Bryan
Bennett, A. F. (D'nt'n & R'dish)	Graham, Thomas
Bermingham, Gerald	Grant, Bernie (Tottenham)
Bidwell, Sydney	Griffiths, Nigel (Edinburgh S)
Blunkett, David	Griffiths, Win (Bridgend)
Boateng, Paul	Grocott, Bruce
Boyes, Roland	Hain, Peter
Bradley, Keith	Hardy, Peter
Bray, Dr Jeremy	Hattersley, Rt Hon Roy
Brown, Gordon (D'mline E)	Haynes, Frank
Brown, Nicholas (Newcastle E)	Heal, Mrs Sylvia
Brown, Ron (Edinburgh Leith)	Henderson, Doug
Bruce, Malcolm (Gordon)	Hinchliffe, David
Caborn, Richard	Hogg, N. (C'nauld & Kilsyth)
Callaghan, Jim	Home Robertson, John
Campbell, Menzies (File NE)	Hood, Jimmy
Campbell, Ron (Blyth Valley)	Howarth, George (Knowsley N)
Campbell-Savours, D. N.	Howell, Rt Hon D. (S'heath)
Canavan, Dennis	Howells, Dr. Kim (Pontypridd)
Carlile, Alex (Mont'g)	Hoyle, Doug
Carr, Michael	Hughes, John (Coventry NE)
Cartwright, John	Hughes, Robert (Aberdeen N)
Clark, Dr David (S Shields)	Hughes, Simon (Southwark)
Clarke, Tom (Monklands W)	Illsley, Eric
Clelland, David	Ingram, Adam
Cohen, Harry	Janner, Greville
Cook, Frank (Stockton N)	Jones, Barry (Alyn & Deeside)
Cook, Robin (Livingston)	Jones, leuan (Ynys Môn)
Corbett, Robin	Kennedy, Charles
Corbyn, Jeremy	Kilfoyle, Peter
Crowther, Stan	Kinnock, Rt Hon Neil
Cryer, Bob	Kirkwood, Archy
Cunliffe, Lawrence	Kumar, Dr. Ashok
Cunningham, Dr John	Lambie, David
Dalyell, Tam	Lamond, James
Darling, Alistair	Leadbitter, Ted
Davies, Rt Hon Denzil (Llanelli)	Leighton, Ron
Davies, Ron (Caerphilly)	Lestor, Joan (Eccles)
Davis, Terry (B'ham Hodge H'l)	Lewis, Terry
Dewar, Donald	Litherland, Robert
Dixon, Don	Livingstone, Ken
Dobson, Frank	Livsey, Richard
Doran, Frank	Lloyd, Tony (Stretford)
Duffy, Sir A. E. P.	Lofthouse, Geoffrey
Dunnachie, Jimmy	Loyden, Eddie
Dunwoody, Hon Mrs Gwyneth	McAllion, John
Eadie, Alexander	McAvoy, Thomas
Eastham, Ken	McCartney, Ian
Enright, Derek	Macdonald, Calum A.
Evans, John (St Helens N)	McFall, John
Ewing, Harry (Falkirk E)	McKay, Allen (Barnsley West)
Ewing, Mrs Margaret (Moray)	McKelvey, William
Fatchett, Derek	McLeish, Henry

McMaster, Gordon	Rooney, Terence
McNamara, Kevin	Ross, Ernie (Dundee W)
McWilliam, John	Ross, William (Londonderry E)
Madden, Max	Rowlands, Ted
Mahon, Mrs Alice	Ruddock, Joan
Marek, Dr John	Salmond, Alex
Marshall, David (Shettleston)	Sedgemore, Brian
Marshall, Jim (Leicester S)	Sheerman, Barry
Martin, Michael J. (Springburn)	Sheldon, Rt Hon Robert
Martlew, Eric	Shore, Rt Hon Peter
Maxton, John	Skinner, Dennis
Meacher, Michael	Smith, Andrew (Oxford E)
Meale, Alan	Smith, C. (Isl'ton & F'bury)
Michael, Alun	Smith, Rt Hon J. (Monk'ds E)
Michie, Bill (Sheffield Heeley)	Soley, Clive
Michie, Mrs Ray (Arg'l & Bute)	Spearing, Nigel
Mitchell, Austin (G't Grimsby)	Steel, Rt Hon Sir David
Moonie, Dr Lewis	Steinberg, Gerry
Morgan, Rhodri	Stephen, Nicol
Morley, Elliot	Stott, Roger
Morris, Rt Hon A. (W'shawe)	Strang, Gavin
Morris, Rt Hon J. (Aberavon)	Straw, Jack
Mowlam, Marjorie	Taylor, Mrs Ann (Dewsbury)
Mullin, Chris	Taylor, Matthew (Truro)
Murphy, Paul	Thomas, Dr Dafydd Elis
Nellist, Dave	Turner, Dennis
Oakes, Rt Hon Gordon	Vaz, Keith
O'Brien, William	Wallace, James
O'Neill, Martin	Walley, Joan
Orme, Rt Hon Stanley	Wardell, Gareth (Gower)
Patchett, Terry	Wareing, Robert N.
Pendry, Tom	Watson, Mike (Glasgow, C)
Pike, Peter L.	Welsh, Andrew (Angus E)
Powell, Ray (Ogmore)	Welsh, Michael (Doncaster N)
Prescott, John	Williams, Rt Hon Alan
Primarolo, Dawn	Williams, Alan W. (Carm'then)
Quin, Ms Joyce	Wilson, Brian
Radice, Giles	Winnick, David
Randall, Stuart	Wise, Mrs Audrey
Rees, Rt Hon Merlyn	Worthington, Tony
Reid, Dr John	Wray, Jimmy
Richardson, Jo
Robertson, George	Tellers for the Ayes:
Rogers, Allan	Mr. Martyn Jones and Mr. Jack Thompson.
Rooker, Jeff

NOES
Adley, Robert	Bowden, A. (Brighton K'pto'n)
Aitken, Jonathan	Bowden, Gerald (Dulwich)
Alexander, Richard	Bowis, John
Alison, Rt Hon Michael	Boyson, Rt Hon Dr Sir Rhodes
Allason, Rupert	Braine, Rt Hon Sir Bernard
Amery, Rt Hon Julian	Brandon-Bravo, Martin
Amess, David	Brazier, Julian
Amos, Alan	Bright, Graham
Arbuthnot, James	Brooke, Rt Hon Peter
Arnold, Jacques (Gravesham)	Brown, Michael (Brigg & Cl't's)
Arnold, Sir Thomas	Bruce, Ian (Dorset South)
Ashby, David	Buck, Sir Antony
Aspinwall, Jack	Budgen, Nicholas
Atkins, Robert	Burns, Simon
Baker, Rt Hon K. (Mole Valley)	Burt, Alistair
Baker, Nicholas (Dorset N)	Butcher, John
Baldry, Tony	Butler, Chris
Banks, Robert (Harrogate)	Butterfill, John
Batiste, Spencer	Carlisle, John, (Luton N)
Beaumont-Dark, Anthony	Carrington, Matthew
Bellingham, Henry	Carttiss, Michael
Bendall, Vivian	Cash, William
Bennett, Nicholas (Pembroke)	Channon, Rt Hon Paul
Benyon, W.	Chapman, Sydney
Bevan, David Gilroy	Churchill, Mr
Biffen, Rt Hon John	Clark, Dr Michael (Rochford)
Blackburn, Dr John G.	Clark, Rt Hon Sir William
Blaker, Rt Hon Sir Peter	Clarke, Rt Hon K. (Rushcliffe)
Bonsor, Sir Nicholas	Colvin, Michael
Boscawen, Hon Robert	Conway, Derek
Boswell, Tim	Coombs, Anthony (Wyre F'rest)
Bottomley, Peter	Cope, Rt Hon Sir John
Bottomley, Mrs Virginia	Cormack, Patrick

Couchman, James	Hogg, Hon Douglas (Gr'th'm)
Cran, James	Hordern, Sir Peter
Currie, Mrs Edwina	Howarth, G. (Cannock & B'wd)
Curry, David	Howe, Rt Hon Sir Geoffrey
Davies, Q. (Stamf'd & Spald'g)	Howell, Rt Hon David (G'dford)
Davis, David (Boothferry)	Howell, Ralph (North Norfolk)
Day, Stephen	Hughes, Robert G. (Harrow W)
Devlin, Tim	Hunt, Sir John (Ravensbourne)
Dickens, Geoffrey	Hunter, Andrew
Dicks, Terry	Irvine, Michael
Dorrell, Stephen	Jack, Michael
Douglas-Hamilton, Lord James	Jackson, Robert
Dover, Den	Janman, Tim
Dunn, Bob	Jessel, Toby
Durant, Sir Anthony	Johnson Smith, Sir Geoffrey
Dykes, Hugh	Jones, Gwilym (Cardiff N)
Eggar, Tim	Jones, Robert B (Herts W)
Emery, Sir Peter	Jopling, Rt Hon Michael
Evans, David (Welwyn Hatf'd)	Key, Robert
Evennett, David	Kilfedder, James
Fairbairn, Sir Nicholas	King, Roger (B'ham N'thfield)
Fallon, Michael	Kirkhope, Timothy
Farr, Sir John	Knapman, Roger
Favell, Tony	Knight, Greg (Derby North)
Fenner, Dame Peggy	Knight, Dame Jill (Edgbaston)
Field, Barry (Isle of Wight)	Knowles, Michael
Fishburn, John Dudley	Knox, David
Fookes, Dame Janet	Lamont, Rt Hon Norman
Forman, Nigel	Lang, Rt Hon Ian
Forsyth, Michael (Stirling)	Lawrence, Ivan
Forth, Eric	Lee, John (Pendle)
Fowler, Rt Hon Sir Norman	Leigh, Edward (Gainsbor'gh)
Fox, Sir Marcus	Lennox-Boyd, Hon Mark
Franks, Cecil	Lester, Jim (Broxtowe)
Freeman, Roger	Lilley, Rt Hon Peter
French, Douglas	Lloyd, Sir Ian (Havant)
Fry, Peter	Lloyd, Peter (Fareham)
Gale, Roger	Lord, Michael
Gardiner, Sir George	Luce, Rt Hon Sir Richard
Garel-Jones, Tristan	Lyell, Rt Hon Sir Nicholas
Gill, Christopher	Macfarlane, Sir Neil
Gilmour, Rt Hon Sir Ian	MacGregor, Rt Hon John
Glyn, Dr Sir Alan	MacKay, Andrew (E Berkshire)
Goodhart, Sir Philip	McLoughlin, Patrick
Goodlad, Alastair	McNair-Wilson, Sir Michael
Goodson-Wickes, Dr Charles	McNair-Wilson, Sir Patrick
Gorman, Mrs Teresa	Madel, David
Gorst, John	Mans, Keith
Grant, Sir Anthony (CambsSW)	Maples, John
Greenway, Harry (Ealing N)	Marland, Paul
Greenway, John (Ryedale)	Marlow, Tony
Gregory, Conal	Marshall, Sir Michael (Arundel)
Griffiths, Peter (Portsmouth N)	Martin, David (Portsmouth S)
Ground, Patrick	Mates, Michael
Grylls, Michael	Maude, Hon Francis
Gummer, Rt Hon John Selwyn	Maxwell-Hyslop, Robin
Hague, William	Mellor, Rt Hon David
Hamilton, Rt Hon Archie	Meyer, Sir Anthony
Hamilton, Neil (Tatton)	Miller, Sir Hal
Hampson, Dr Keith	Mills, Iain
Hannam, John	Miscampbell, Norman
Hargreaves, A. (B'ham H'll Gr')	Mitchell, Andrew (Gedling)
Hargreaves, Ken (Hyndburn)	Mitchell, Sir David
Harris, David	Moate, Roger
Haselhurst, Alan	Monro, Sir Hector
Hawkins, Christopher	Montgomery, Sir Fergus
Hayes, Jerry	Moore, Rt Hon John
Hayhoe, Rt Hon Sir Barney	Morris, M (N'hampton S)
Hayward, Robert	Morrison, Sir Charles
Heathcoat-Amory, David	Morrison, Rt Hon Sir Peter
Heseltine, Rt Hon Michael	Moss, Malcolm
Hicks, Mrs Maureen (Wolv' NE)	Moynihan, Hon Colin
Hicks, Robert (Cornwall SE)	Neale, Sir Gerrard
Higgins, Rt Hon Terence L.	Neubert, Sir Michael
Hind, Kenneth	Newton, Rt Hon Tony

Nicholls, Patrick	Stanbrook, Ivor
Nicholson, David (Taunton)	Stanley, Rt Hon Sir John
Nicholson, Emma (Devon West)	Steen, Anthony
Norris, Steve	Stern, Michael
Onslow, Rt Hon Cranley	Stevens, Lewis
Oppenheim, Phillip	Stewart, Allan (Eastwood)
Page, Richard	Stewart, Andy (Sherwood)
Paice, James	Stewart, Rt Hon Sir Ian
Parkinson, Rt Hon Cecil	Tapsell, Sir Peter
Patnick, Irvine	Taylor, Ian (Esher)
Patten, Rt Hon Chris (Bath)	Taylor, Sir Teddy
Patten, Rt Hon John	Temple-Morris, Peter
Pattie, Rt Hon Sir Geoffrey	Thompson, D. (Calder Valley)
Pawsey, James	Thompson, Patrick (Norwich N)
Peacock, Mrs Elizabeth	Thorne, Neil
Porter, Barry (Wirral S)	Thornton, Malcolm
Porter, David (Waveney)	Thurnham, Peter
Portillo, Michael	Townend, John (Bridlington)
Powell, William (Corby)	Townsend, Cyril D. (B'heath)
Price, Sir David	Tracey, Richard
Raison, Rt Hon Sir Timothy	Tredinnick, David
Rathbone, Tim	Trotter, Neville
Redwood, John	Twinn, Dr Ian
Renton, Rt Hon Tim	Vaughan, Sir Gerard
Rhodes James, Sir Robert	Viggers, Peter
Ridley, Rt Hon Nicholas	Waldegrave, Rt Hon William
Ridsdale, Sir Julian	Walker, Bill (T'side North)
Rifkind, Rt Hon Malcolm	Waller, Gary
Roberts, Rt Hon Sir Wyn	Walters, Sir Dennis
Roe, Mrs Marion	Wardle, Charles (Bexhill)
Rossi, Sir Hugh	Warren, Kenneth
Rost, Peter	Watts, John
Rumbold, Rt Hon Mrs Angela	Wells, Bowen
Ryder, Rt Hon Richard	Wheeler, Sir John
Sackville, Hon Tom	Whitney, Ray
Sainsbury, Hon Tim	Widdecombe, Ann
Sayeed, Jonathan	Wiggin, Jerry
Scott, Rt Hon Nicholas	Wilkinson, John
Shaw, David (Dover)	Wilshire, David
Shaw, Sir Giles (Pudsey)	Winterton, Mrs Ann
Shaw, Sir Michael (Scarb')	Winterton, Nicholas
Shelton, Sir William	Wolfson, Mark
Shepherd, Colin (Hereford)	Wood, Timothy
Shepherd, Richard (Aldridge)	Woodcock, Dr. Mike
Shersby, Michael	Yeo, Tim
Sims, Roger	Young, Sir George (Acton)
Skeet, Sir Trevor	Younger, Rt Hon George
Smith, Tim (Beaconsfield)
Soames, Hon Nicholas	Tellers for the Noes:
Spicer, Sir Jim (Dorset W)	Mr. David Lightbown and Mr. John M. Taylor.
Spicer, Michael (S Worcs)
Squire, Robin

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.

Mr. Deputy Speaker

forthwith declared the main Question, as amended, to be agreed to.

Resolved, That this House welcomes the fact that interest rates have been set at a level within the European Exchange Rate Mechanism which has succeeded in substantially reducing inflation; and congratulates Her Majesty's Government on the continued success of its policies to put a decent home within reach of every family, by promoting home occupation, by the success of the Right to Buy, by securing greater private sector investment, by promoting diversification of tenure and tenant involvement, by directing public expenditure so as to secure more effective use of resources and improved performance from housing authorities and by increasing the budget of the Housing Corporation by 94 per cent. over three years.